Power to our neighbourhoods: towards integrated local sustainable energy solutions Learning from success

A report by CAG Consultants for the  Ashden Awards for Sustainable Energy June 2010 Full Report

About the Ashden Awards for Sustainable Energy The Ashden Awards for Sustainable Energy were founded in 2001 to reward and encourage the widespread use of local sustainable energy in the UK and the developing world in order to reduce carbon emissions and improve lives. UK Ashden Award winners, numbering more than 40, are delivering innovative local sustainable energy solutions through renewable energy, energy efficiency measures and behaviour change. They are drawn from sectors including small businesses, local authorities, charities and schools.

The Ashden Awards, Allington House, 150 Victoria Street, London SW1E 5AE Tel: + 44 (0)20 7410 7055 [email protected] www.ashdenawards.org Registered Charity No 1104153

About CAG Consultants CAG Consultants is an employee-owned business providing support, policy advice and training in a wide range of inter-related fields which can broadly be categorised as: sustainable development and climate change; regeneration; and stakeholder and community involvement. Founded in 1983, we continue to deliver high quality, innovative and thoughtful work for our clients, who include government departments, local authorities, public agencies, the NHS and regeneration and community planning partnerships in both urban and rural areas.

CAG Consultants, Gordon House, 6 Lissenden Gardens, London, NW5 1LX Tel: 020 7482 8882 [email protected] www.cagconsultants.co.uk

About Houghton Research This report has been produced in association with Houghton Research. Trevor Houghton MSc is an independent consultant who has been working in the field of sustainable development for nearly 25 years with particular expertise in energy, climate change, planning and fuel poverty.

Acknowledgements This research was conducted by CAG Consultants, working closely with The Ashden Awards for Sustainable Energy and members of the project‟s Advisory Group (see Annex A).

We are grateful to all those that gave their time and expertise to take part in the research, including UK Ashden Award winners and other pioneering practitioners, nationally-renowned sustainable energy experts, and officials from Government and key public bodies.

We are also very grateful to the Esmée Fairbairn Foundation for funding this work.

This report can be downloaded at www.ashdenawards.org

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Contents

Executive Summary 4

1. Introduction 15 1.1 Background 15 1.2 Objectives 16 1.3 Approach 17 1.4 Structure of the report 18

2. The scale of the challenge in the UK 19 2.1 What is the challenge? 19 2.2 The policy landscape 24 2.3 The economic landscape 32

3. Learning from success: what has been achieved? 33 3.1 Local sustainable energy initiatives 33 3.2 Area-based energy efficiency approaches 38 3.3 Other approaches to delivering local sustainable energy 44

4 Building on success: what could be done? 50 4.1 What have we learned? 51 4.2 Existing approaches to delivering local sustainable energy 51 4.3 What could be done? 53 4.4 What might enhanced area-based approaches look like? 54 4.5 How can we enable success? 55 4.6 Empowering communities 60

5. Conclusions and recommendations 65 5.1 What are our conclusions? 65 5.2 How do we get there? 65 5.3 Considerations for the Ashden Awards 69

References 72 Annex A. Project Advisory Group 76 Annex B - Summary of practitioner workshops 77 Annex C. In-depth interviews 81

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Executive Summary

Introduction Delivering local sustainable energy solutions1 at the neighbourhood level, through energy saving measures, small-scale renewable energy generation and collective behaviour change, is vital if the UK is to move towards a low carbon future.

Drawing on best practice, this report demonstrates that area-based energy efficiency initiatives are a successful model for delivering emissions reductions at the neighbourhood scale.

Furthermore, we believe that area-based approaches could be significantly enhanced if integrated with other successful approaches to delivering local sustainable energy. Empowering communities to take action, developing local energy supply and generation and building local supply chains are all invaluable.

The report highlights the conditions that would enable this to happen and puts forward recommendations that will enable government to create a framework for a low carbon revolution in neighbourhoods across the UK.

What makes this report different? The Ashden Awards wanted to know whether significantly more carbon savings could be achieved through pulling together local sustainable energy initiatives in an area to create synergies of skills, experience and enterprise, as well as economies of scale.

This report provides an answer. It explores what could be achieved through better integration and coordination and makes recommendations for scaling-up and replicating successful approaches.

Uniquely, our research draws on the experience of Ashden Award winners and other innovative practitioners in the field of local sustainable energy. Ashden Award winners have already demonstrated that local sustainable energy solutions - through technological solutions and through behaviour change - can play a significant role in the transition to a low carbon economy. It is from their success that we draw our findings.

We have also worked closely with a Project Advisory Group - drawn from successful practitioners, key government stakeholders and local sustainable energy experts - to define

1 The Ashden Awards defines local sustainable energy as having three strands all delivered close to point of use:  Energy saving programmes in homes and in public and private sector organisations. Examples include improved insulation or behavioural change, combined heat and power, and community heat networks.  Renewable electricity. Examples include solar PV, mini-hydro, and wind turbines.  Renewable heating and cooling. Examples include solar thermal, biomass boilers and ground source heat pumps.

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and evolve the focus of the research. This has enabled the research to be responsive to those involved in delivering local sustainable energy solutions, while at the same time being informed by the ever-evolving policy context. And by working closely with government, we have been able to feed in the findings of the research as it emerged, to help inform policy as it has developed.

What do we need to do? The UK is committed to reducing emissions by at least 80% below 1990 levels by 2050, and by at least 34% by 2020. We need to do this by providing clean energy from fossil-free energy sources and reducing demand, while at the same time helping enhance the „security‟ of energy supply.

The new UK Government has pledged to become the „greenest government ever‟ and it now has a fantastic opportunity to expand support for energy efficiency and renewable energy. It also plans to create a „big society‟, through using the state to galvanise social action, empowering individuals and neighbourhoods. But it must do this within the context of reducing the structural deficit over the course of the next Parliament.

Local sustainable energy solutions will play a crucial role in achieving this change. Their potential is huge. They can deliver significant physical and technological change. Insulation can deliver massive emissions reduction in the short term while small-scale renewable energy generation has considerable potential for emissions reductions in the residential sector - small scale wind turbines, solar PV, solar thermal water heating, biomass heating, ground source heat pumps, Combined Heat and Power and district heating schemes can all deliver.

And local sustainable energy solutions are ideally placed to support behaviour change. Individuals can contribute to carbon emissions reduction through relatively minor behavioural changes.

Ultimately at the neighbourhood level, local sustainable energy solutions can support a more fundamental move towards low carbon living through changes to collective behaviour, beliefs and value systems. The Big Green Challenge2 found that “community-based initiatives can initiate a process of culture change in the community which reinforces and sustains individual behaviour change”.

What has been achieved? Area-based energy efficiency approaches Area-based energy efficiency approaches are an increasingly common and much- championed form of local sustainable energy initiative, sometimes referred to as „street-by- street‟ approaches. The UK Government, the Scottish Government, the Committee on Climate Change and the Energy Saving Trust (EST) have all shown support for this

2 The Big Green Challenge was a £1 million challenge prize run by NESTA designed to stimulate and support community-led responses to climate change. www.nesta.org.uk/areas_of_work/public_services_lab/environment/big_green_challenge

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approach and as a result energy efficiency policies are increasingly favouring area-based approaches as a means of delivering greater emissions savings.

The EST defines an area-based approach as one that “delivers energy efficiency measures in a spatial area - which could be a street, neighbourhood, a local authority area or a group of local authority areas”.

Ashden Award winners have been at the forefront of developing this type of approach and our research has focused on two examples in particular. Kirklees Warm Zone is a large-scale urban scheme covering 171,000 households, created to install home insulation measures (cavity wall and loft insulation). Meanwhile, the Hadyard Hill scheme, run by the Energy Agency in Ayrshire, is a small-scale rural scheme covering less than a 1000 households.

Table 1: take up of measures in Ashden Award winners area-based initiatives

Name of Total % of % take up of % take up of initiative households households initial measures in area contacted assessment (number) (number) (number) Kirklees Warm 157,000 82% of 62% 68% Zone3 occupied occupied homes (97,366)4 (107,159) referred homes (129,453) for detailed surveys

25% (40,000) had measures installed by March 2010 Hadyard Hill 828 96% 90% 57% (791) (748) (469)

Both schemes have been very successful. They demonstrate:

 Area-based approaches can deliver significant levels of take up and coverage (see table 1), especially when they offer universally free measures.

 Significant economies of scale can be achieved.

 A number of wider benefits can also be achieved, including local job creation, increased disposable income, benefit checks and health improvements.

 Area-based approaches can work in rural as well as urban areas.

Other approaches to delivering local sustainable energy Our research has also highlighted a range of other local sustainable energy initiatives that also offer real benefits both in terms of carbon savings and wider sustainability gains.

3 The Kirklees initiative is ongoing. Figures reflect progress by end of March 2010. 4 In Kirklees a proportion of the households visited were council owned and therefore not eligible for measures, but were offered all other support.

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Priming and supporting communities There are now a number of initiatives that are successfully working with communities, providing them with the knowledge, skills and confidence to continue taking action to reduce emissions in the longer-term.

Local energy supply and generation A number of initiatives involve the development of a localised - and sometimes community- owned - energy supply. Ashden Award winner ALIEnergy, for example, has aided communities to develop sustainable energy supply, the most advanced example being the Island of Gigha where the islanders have installed three wind turbines with a capacity of 670 kW which provide the community with 75% of their electricity requirements and an annual net income of around £75,000 from electricity sales.

Developing local supply chains, creating local jobs Bringing together key partners to develop local supply chains for renewable energy fuel supply and installation, and expanding the number and capacity of local installation companies, Ashden Award winner Renewable Energy for Devon (RE4D) was set up by Devon County Council and its partners. It maximises the opportunities for local economic benefits and business growth amongst renewable energy companies by increasing the demand for smaller scale renewable energy installations, while also assisting SMEs and communities to reduce their energy costs.

Supporting energy intelligent businesses The experience of one Ashden Award winner, ENWORKS, shows that a regionally based partnership can deliver support to businesses at the local level whilst ensuring strategic alignment with regional and national policies. ENWORKS provides support to over 1,000 companies each year, delivering 66,000+ tonnes of CO2 savings per year.

Developing a long-term vision Hackbridge Sustainable Suburb has a novel planning-led approach to developing a low carbon neighbourhood. A masterplan has been formulated that provides a long-term vision which incorporates new development alongside refurbishment of existing buildings. Its success is that it has brought together the local authority and the community to develop a truly comprehensive plan to transform a whole area.

What have we learned? The examples we have looked at prove that sustainable energy initiatives delivered at a neighbourhood scale can achieve significant benefits in delivering carbon emissions cuts, increasing the take-up of insulation measures, supporting jobs and businesses and empowering communities.

We have focused on a range of different examples of local sustainable energy intiatives which highlight different „fields‟ of local sustainable energy, notably energy efficiency, behaviour change, and small-scale renewable generation.

Another way of looking at the experience to date, is to consider approaches as a continuum, summarised in the table below.

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The continuum presented here ranges from approaches that are extremely large in scale and have no community involvement, to those which are very small in scale, but are led and owned by the community.

There also differences in the breadth and depth of the schemes. The larger schemes tend to have very wide coverage and offer economies of scale, but focus on a very limited range of measures (e.g. loft insulation), whereas the smallest are very limited in coverage but often involve much more systematic change, involving changes in values, skills, awareness and behaviours, as well as a range of measures. The former are easier for governments to promote through policy frameworks, the latter are so small they can fall off the policy radar.

The schemes also demonstrate that there is not a „one-size-fits-all‟ model for delivering local sustainable energy. The examples reviewed work because they are „situated‟ within the local area, reflecting local culture, conditions and needs. And none of the approaches described here are mutually exclusive. Different approaches have different advantages and disadvantages and some will be more suited to some areas than others.

What could be done? To build on success, we not only need a policy framework that encourages a multiplication of local sustainable energy initiatives reflecting local diversity, but we also need to encourage approaches that go even further.

A much more comprehensive package of measures needs to be applied to homes and businesses which includes micro-generation technologies and more disruptive/costly measures such as solid wall insulation.

Alongside this is the need for fundamental behaviour change as part of a major shift in values and collective behaviour. Without a shift in behaviours, carbon savings made through physical measures in households could be undone through the actions of the householders themselves.

Mix and match Area-based or street-by-street approaches clearly offer enormous potential, but they could go a lot further through „adding on‟ or integrating other approaches.

These enhanced area-based approaches could offer the advantages of schemes such as Kirklees - wide coverage, economies of scale, local job creation - alongside collective change and action, developed local sustainable energy supply, or supporting the development of local supply chains.

What might these enhanced area-based approaches look like? They would mix and match different elements from the approaches outlined in Table 2 and described above. By way of example, two scenarios might be:

Scenario 1 A local authority integrates an area-based energy efficiency scheme (option 2 in Table 2) within a longer-term, more holistic vision and plan for reducing emissions in a neighbourhood, working with the community to shape their area (option 3).

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Scenario 2 The area-based energy efficiency scheme (option 2) is designed and delivered to lay the foundation for increasing community leadership on emissions reduction (options 4 and/or 5). This would combine the roll-out of energy-efficiency measures with comprehensive action to build collective change within the community, creating a legacy for further action and leadership from within the neighbourhood. The process could also be used to create local jobs, business and social enterprise.5

Enabling factors What are the conditions and various roles necessary to make any of these approaches a success?

The importance of an impartial ‘hub’ organisation A common factor in the area-based initiatives we have looked at is the presence of an impartial hub organisation, a locally trusted organisation that can orchestrate activity, is trusted by the communities it is working with and is skilled in bringing together and working with local partners. This might be the local authority, a socially-minded third sector organisation, and in some cases could even be a local community group.

Local authority involvement Local authorities have often played an important, if not central, role in the delivery of local sustainable energy initiatives. They can lead schemes, provide some or all of the funding for projects, can use their community leadership role to bring together key partners, are generally trusted by residents, and have a wide range of roles and responsibilities which can be used to deliver sustainable energy locally. Many local authorities will require further incentives and support in order to follow the example of pioneers such as Kirklees.

Partnership working All of the initiatives that we have reviewed have involved extensive partnership working. In Kirklees Warm Zone, for example, the local authority has worked with a range of partners to deliver benefits that go well beyond energy efficiency measures, including benefits checks, health referrals, fire safety checks, and, anecdotally, the strengthening of community cohesion.

Developing a local supply chain One of the successes of the initiatives reviewed has been their ability to work with leading sustainable energy businesses to develop local supply chains. This can offer enormous benefits. It develops a source of local, trusted expertise on sustainable energy issues, creates jobs and increases local ownership and support for the initiative.

Green entrepreneurs Green entrepreneurs are individuals or organisations - often locally-based - that provide the drive, dynamism and creative spark to kick-start and develop an initiative. They are very often key to the achievement of successful local sustainable energy initiatives.

5 Note that we explore the options for mixing and matching different approaches in more detail in the full report.

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Customer care One of the success factors behind the area-based schemes was a strong focus on what in business terms might be described as „customer care.‟ This includes being flexible in meeting the needs of householders, minimising the period from first contact to installation of measures, and being responsive to complaints.

Creating income streams Given the squeeze on public spending, alternative mechanisms for funding are crucial. One route is developing independent income streams based on the ownership of key assets such as renewable energy generating plant. Again Ashden Award winners are demonstrating this as a key factor in their success. New feed-in tariffs and the renewable incentive and pay-as- you-save scheme offer real opportunities.

Empowering communities We believe that strong community involvement, and in some cases leadership, can add a significant extra dimension to achieving carbon reductions at the neighbourhood scale.

Culture change Local sustainable energy initiatives with a strong community element can achieve a culture change which might be defined as a change in collective behaviour, beliefs and value systems. It kick-starts a process where it becomes normal behaviour for people to seek to cut carbon emissions and where people adopt the view that there is a collective responsibility to take action.

Building on existing communities This enables initiatives to tap into existing community strengths, which can increase buy-in and take-up of measures. This is backed up by respondents to interviews carried out for this project. The Energy Agency, Ayrshire, for example, has tailored the support it provides according to the strength of communities it is working with. Some communities, however, will need support because of lack of social cohesion, lack of skills and levels of confidence among individuals.

Community leadership and momentum Dynamic local individuals, community groups and organisations are often at the heart of local sustainable energy initiatives. Empowering them to devise and lead work on emissions reduction can lead to local solutions that fit the local context and are better at delivering than programmes that operate on a top-down basis. This can result in a legacy of community action on emissions reduction.

Utilising trusted individuals and known networks Community action is based on the existing trusted relationships among local individuals and local networks. The community can provide the interface between national actors (e.g. government, government agencies, energy suppliers) and ordinary people (e.g. faith groups and residents associations).

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What are our conclusions? The research has found that „one-size does not fit all‟ when it comes to delivering local sustainable energy solutions. More often than not, best practice is the result of innovative, entrepreneurial, partnership approaches, based on local intelligence. Success is often achieved in spite of, not because of, the existing policy framework.

As we have stressed, area-based energy efficiency initiatives are a very good model for delivering emissions reductions at the neighbourhood scale. They deliver significant levels of take up of simple insulation measures in a cost-effective way, whilst also achieving a number of wider benefits, such as local job creation and benefits checks.

These approaches could be significantly enhanced if integrated with other successful approaches to delivering local sustainable energy, for example through empowering communities to take action, local energy supply and generation and building local supply chains. This would build on the strengths of area-based approaches, whilst offsetting their weaknesses, providing a more holistic approach to emissions reduction that creates lasting momentum and community engagement at the neighbourhood level.

How do we get there? The election of a new Government, one that intends to be the greenest ever and wants to empower neighbourhoods to take social action, means there is a real opportunity to create a framework that will enable enhanced area-based approaches to be right at the heart of the UK‟s transition to a low carbon economy.

So what is required?

A policy framework for more enhanced area-based solutions Government should create a framework that supports the development of enhanced area- based approaches. Government needs to provide a strong sense of overall direction, giving appropriate support at key points in the development of enhanced area-based schemes. It also must provide the incentives, flexibility, and space - and remove the barriers - for communities, local authorities, social entrepreneurs and businesses to develop the solutions that work best for the areas in which they operate.

To help create the right framework for enhanced area-based solutions to flourish, we make the following recommendations.

Recommendation 1 The new government should build on the plans set out by the previous administration for developing a flexible policy framework for home energy saving.

It should allow for a diversity of approaches that goes beyond the installation of energy efficiency measures. It should encourage the involvement of community groups in delivery partnerships, and reward action to achieve „softer‟ outcomes that influence human behaviour and help to create a momentum for change within neighbourhoods. It should aim to reach community groups and businesses as well as individual households.

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Recommendation 2 Government should consider developing a programme to test out how to support very broad area-based schemes that include actions on energy, waste, water, food, transport, and greening the local economy. This could build on the work of the Low Carbon Communities Challenge and would involve a pooling of budgets from related policy areas, so as to promote more co-ordinated support to area-based schemes to achieve multiple policy objectives.

Recommendation 3 Government should build on this research and that of others6 to open a dialogue with Ashden Award winners and other local sustainable energy practitioners to develop a model for enhanced area-based approaches.

Recommendation 4 Government should convene a project that brings together local practitioners with carbon measurement and behaviour change experts to develop standardised methodologies and tools that are capable of measuring change across a very broad range of carbon emission reduction activities. This would enable a more consistent monitoring and evaluation of which approaches work best.

Supporting community action Recommendation 5 As part of the efforts to create a „Big Society‟, government and the EST should expand its support for community capacity-building for local sustainable energy, building on the lessons learned from existing practice.

Recommendation 6

Government should work with others to develop the evidence-base to help communities to identify what works and to quantify the benefits of such action.

Finance Recommendation 7 Government should continue to provide and expand competitive grant funding to provide initial support for a diverse range of enhanced area-based approaches with strong community involvement.

Recommendation 8 The new green investment bank should develop models for financing initiatives that promote multiple sustainable energy outcomes and that are as accessible for „deeper‟ but small-scale projects, as for larger-scale projects.

Recommendation 9

6 See for example the Sustainable Development Commission‟s report on creating Sustainable Neighbourhood Infrastructure Partnerships.

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Government should consider how loan guarantees can be provided to underwrite risks to enable community organisations to access private finance.

Recommendation 10 Government should consider enhanced FITs and RHI payments for neighbourhood renewable energy projects that are creating income streams for further carbon reduction measures in their communities.

Local authorities Recommendation 11 Government plans to abolish the Comprehensive Area Assessment, but it should ensure that there is a significant mandate in place that encourages local authorities to work with communities and business to considerably reduce emissions in their area, building on NI186 and the Local Carbon Framework pilots.

Recommendation 12 Kirklees and other pioneering local authorities are showing what an important role local government can play in reducing emissions at the neighbourhood scale. But most local authorities lack the skills and resources to play their part. Government should therefore work with local government and improvement organisations to build the capacity of all local authorities so that they are equipped to make a significant contribution to area-wide emissions reductions.

A full set of recommendations can be found in the main report, which can be downloaded from www.ashdenawards.org

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1. Introduction

1.1 Background The Ashden Awards for Sustainable Energy believes that the next few years will be critical in establishing the policy, investment and frameworks that will deliver a low carbon future. The passing of the Climate Change Act 2008 presents the enormous challenge of delivering on the 80% emissions reduction target by 2050. Over the coming months and years, the new UK Government has an opportunity to rapidly expand support for energy efficiency and renewable energy in order to set the UK firmly on the path towards the 2050 targets.

Ashden Award winners have already demonstrated that local sustainable energy initiatives - through technological solutions and through behaviour change - can play a significant role in helping us get there. This research provides further answers as to how we can accelerate that progress.

1.1.1 Why this research was commissioned The Ashden Awards is a UK charity that works to increase the uptake of local sustainable energy across the world. It does this by finding and supporting leading sustainable energy programmes in the UK and across the developing world. What makes our winners unique is proven success. In order to win an award it is necessary to demonstrate significant carbon savings over time. We know our winners deliver.

In the spring of 2009, based on the experience of our UK winners, we published a report, undertaken by the Institute for Public Policy Research. „From Practice to Policy‟ (IPPR and Ashden Awards 2009) made practical policy recommendations aimed at increasing the scale and scope of sustainable energy in the UK.

The work identified two common themes. The first was that there is a need for all political parties to commit to a long-term strategy, offering predictable funding flows. The other was the need to develop policies that are not only about the large energy companies, but that also support local actors, including local authorities, charities and smaller companies.

This project provided some answers, but it also raised a number of questions. Principally, the Ashden Awards wanted to know whether significantly more carbon savings could be achieved through pulling together local sustainable energy initiatives in an area to create synergies of skills, experience and enterprise, as well as economies of scale. This report provides an answer. It explores what could be achieved through better integration and coordination and makes recommendations for scaling-up and replicating successful approaches.

The Ashden Awards also recognised that if it wanted to affect change in Government, it would be more beneficial to work with key individuals in shaping the research, rather than presenting a report as a „fait accompli‟. With that in mind, the Ashden Awards invited Government departments, alongside experts in the field and some of our winners, to sit on the Project Advisory Group so that we could feed-in the emerging learning as we went.

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Through a tendering process, CAG Consultants were appointed to deliver this work with the Ashden Awards.

1.1.2 Local sustainable energy The Ashden Awards believe that local sustainable energy is a vital component in moving the UK towards a low carbon future, by providing clean energy from fossil-free energy sources, reducing demand and helping enhance the „security‟ of energy supply. The Ashden Awards‟ experience has shown that „local‟ agencies in the private, public and charitable sectors are often best placed to deliver durable sustainable energy. It also knows from its award-winners, that these solutions have many social and community benefits as well as creating a much greater awareness of energy use and efficiency.

The Ashden Awards defines local sustainable energy as having three strands all delivered close to point of use:

 Energy saving programmes in homes and in public and private sector organisations. Examples include improved insulation or behavioural change, combined heat and power, community heat networks.

 Renewable electricity. Examples include solar PV, mini-hydro, or wind turbines.

 Renewable heating and cooling. Examples include solar thermal, biomass boilers, ground source heat pumps.

1.1.3 ‘Community’ Throughout this report there is extensive reference to „communities‟ and „community-led‟ approaches and initiatives. The term community is used to refer to the local formal and informal social networks, voluntary groups, businesses and interests that operate in a defined geographical area. In some instances these will be linked through a partnership. There is, in most instances, a strong link to local government, but it is not assumed that the view of the local council is synonymous with the „community‟ viewpoint and interest.

It is also recognised that communities vary considerably in their cohesiveness and their capacities. This also qualifies the use of the term „community-led‟ when referring to specific initiatives. In some areas it is a community based organisation (such as a Development Trust) that is running the show, but in others it may be a partnership where responsibilities and leadership are shared with a local authority, an energy agency or a non-governmental organisation (NGO).

1.2 Objectives The primary aim of the research has been to explore what could be achieved through better integration and coordination of local sustainable energy solutions in an area and to translate the lessons into recommendations for scaling-up and replicating successful approaches.

In particular, we have sought to:

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1. Examine what could be achieved through the integration and coordination of local sustainable energy solutions in an area, and identify:

 How such integrated approaches could be delivered.

 The factors that would enable them to happen.

 How such approaches could help create the conditions for social change and help create local ownership and leadership.

 What synergies and benefits would be achieved through such approaches that individual solutions couldn‟t achieve alone, including non-energy related benefits.

2. Build on and learn from the experience of local sustainable energy practitioners, including Ashden Award winners.

3. Facilitate dialogue between local energy practitioners and policy makers to ensure emerging policy supports practitioners‟ needs and builds on their experience.

For this project, we have worked with a range of successful, local energy practitioners to enable key stakeholders, including the Government, to understand the role that the local sustainable energy solutions offered by these smaller advocates could play in creating a low carbon future and to consider how such potential might be realised.

1.3 Approach We have taken an innovative approach to the research It is a collaboration between Ashden Award winners and other practitioners, between the „policy makers‟ and the „policy deliverers‟, between the researchers and the commissioners and, ultimately between all the interested parties.

From the start, we have worked closely with a Project Advisory Group - drawn from successful practitioners, key Government stakeholders and local sustainable energy experts - to define and evolve the focus of the research (see Annex A for a full membership list of the Project Advisory Group). This has enabled the research to be responsive to those involved in delivering real, local sustainable energy solutions, while at the same time keeping abreast of the ever-evolving policy context. And by working closely with Government officials, we have been able to feed in the findings of the research as it emerged, to help inform policy as it has developed.

The research findings outlined in this report have been drawn from a number of sources, including:

 An extensive literature review on the experience of implementing local sustainable energy solutions.

 A review of party political positions towards local sustainable energy.

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 Two practitioner workshops, held with local sustainable energy practitioners, including many Ashden Award winners, as well as key national stakeholders (see Annex B for a summary report of the workshops).

 In-depth telephone interviews with Ashden Award winners and other successful local energy practitioners (see Annex C).

 The expertise and contributions of the project‟s Advisory Group (see Annex A).

1.4 Structure of the report In the following chapter, we describe the scale of the climate change and energy challenge in the UK, particularly in relation to local sustainable energy and the housing stock (section 2.1). We then set out the policy landscape for local sustainable energy (section 2.2), as well as the economic landscape (section 2.3).

In chapter 3, we summarise existing success in delivering local sustainable energy. We focus on area-based energy efficiency approaches in section 3.2 and then highlight success with other types of local sustainable energy initiatives in section 3.3.

In chapter 4, we go to on to consider how these different approaches to delivering local sustainable energy might be integrated to create „enhanced‟ area-based approaches. We consider what enhanced area-based approaches might look like (section 4.4), key factors for enabling their success (section 4.5) and the important role that communities could play in these (in section 4.6).

We set out our key conclusions (section 5.1) and recommendations (section 5.2) in Chapter 5. We also put forward a number of issues for the Ashden Awards to consider (section 5.3).

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2. The scale of the challenge in the UK

Chapter summary

The UK is committed to reducing emissions by at least 80% below 1990 levels by 2050, and by at least 34% by 2020. We need to do this by providing clean energy from fossil- free energy sources and reducing demand, while at the same time helping enhance the „security‟ of energy supply. There are particularly big opportunities for reducing emissions in the household sector, which accounts for 27% of the UK‟s carbon emissions.

Local sustainable energy solutions will play a crucial role in achieving this change. They can deliver significant physical and technological change. Insulation can deliver massive emissions reduction in the short term while small-scale renewable energy generation has considerable potential for emissions reductions in the residential sector.

And local sustainable energy solutions are ideally placed to support behaviour change. Individuals can contribute to carbon emissions reduction through relatively minor behavioural changes. And at the neighbourhood level, local sustainable energy solutions can support a more fundamental move towards low carbon living through changes to collective behaviour, beliefs and value systems.

The new UK Government has pledged to become the „greenest government ever‟ and it now has a fantastic opportunity to expand support for energy efficiency and renewable energy. It also plans to create a „Big Society‟, by using the state to galvanise social action, empowering individuals and neighbourhoods. But it must do this within the context of reducing the structural deficit over the course of the next Parliament.

It inherits a wide range of policies and programmes from the previous administration designed to deliver local sustainable energy improvements. Additionally, the Scottish Government and Welsh Assembly Government also have their own policies in place to support local low carbon economies.

2.1 What is the challenge?

2.1.1 Achieving a low carbon economy “(No area) is more important than the area of energy, climate, and reducing our carbon emissions. So now it‟s time to roll up our sleeves and get down to work”. David Cameron, Prime Minister (number10.gov.uk 2010).

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To prevent the most dangerous impacts of climate change, average global temperatures must rise by no more than 2C. Global greenhouse gas emissions must start falling before 2020 and by at least 50% below 1990 levels by 2050. For the UK, this means reducing emissions by at least 80% below 1990 levels by 2050, and by at least 34% by 2020. To do this, the UK will need to transform its economy from one that is heavily reliant on fossil fuel, to one that is low carbon.

This is both technologically achievable and economically affordable, according to the Committee on Climate Change (2008). Technologically, it says that:

 Decarbonisation of the power sector is key to achieving emissions reductions targets and that renewable generation could make a significant contribution.

 Emissions reductions in buildings and industry can be achieved through energy efficiency improvements and the introduction of new technologies.

 Transport emissions cuts, through the introduction of new technologies, will be required.

Economically, the Committee draws similar conclusions to the Stern Review (2006), finding that “the costs of meeting the 80% target are affordable and should be accepted given the consequences and higher costs of not acting.” It estimates that the 80% cut can be achieved at a cost of around 1-2% of GDP in 2050.

Whilst the transition to a low carbon economy may be technologically and economically feasible, the Committee warns that a radical shift in the speed and scale of efforts is required if we are to get there:

“The UK is working towards achieving a 34% reduction in emissions by 2020, which requires annual reductions of 2-3%. However, the Committee on Climate Change‟s progress report found that the UK has only achieved annual average CO2 emissions cuts of around 0.5% in recent years. It called for a step change to be made by Government in the pace of emissions reductions so that the UK remains on track to meet carbon budgets and its wider commitments to tackle global warming. It highlighted the need for action notwithstanding the recession, and the need for policy strengthening to drive the required step change” Committee on Climate Change, (2010).

2.1.2 What change is required? Local low carbon solutions have an important role to play in achieving this step change. They can help achieve:  Physical and technological change.

 Change to individual and collective behaviour.

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Physical and technological change

Energy saving measures. Physical measures such as insulation as well as behavioural measures such as turning down the heating, have huge potential to reduce emissions in the short term. The Committee on Climate Change (2008, p xvi) says that “there is major scope for significant emissions reductions (electricity and heat related) through energy efficiency improvement and through relatively minor changes in behaviour that have minimal consequences for welfare.”

Small-scale renewable energy generation. The Committee on Climate Change (2008, p235) has identified the technical potential for emissions reductions in the residential sector from small-scale renewable energy generation. For instance, it estimates that:  Around five million properties could be fitted with small scale wind turbines, resulting in emissions reduction of five million tonnes of carbon dioxide (MtCO2).

 Solar PV could be added to around 25 million properties in the UK, resulting in emissions reduction of 20 MtCO2.

 Solar thermal water heating could be added to 18 million households in the period up to 2020, resulting in emissions reduction of 6 MtCO2.

 Up to four million off gas grid households could move to biomass heating, resulting in emissions reduction of 21 MtCO2...

 Around 9 million properties could be fitted with ground source heat pumps, with emissions reduction of 3 MtCO2.

 Combined Heat and Power (CHP) could deliver just over 1 MtCO2 by 2020.

 District heating schemes have the potential to save over 5 MtCO2 by 2022.

However, while the technologies are available, there are still significant non-technical barriers to the take up of such solutions. The Committee on Climate Change (2008) points out that the costs of these technologies, together with a limited willingness and ability to install microgeneration, mean that there is a significant difference between the technical potential and the realistic potential for emissions reduction from these measures.

The IPPR report for the Ashden Awards (2009) also cites a number of barriers to the take- up of local sustainable energy including: the amount and consistency of funding, the stop- start nature of some policies, difficulties in accessing capital, lack of householder engagement, planning permission, and the costs and disruption involved in retrofitting „hard-to-treat‟ homes. It is these non-technical barriers that we focus on in this report.

Changing individual and collective behaviour The IPPR report also highlighted a lack of householder engagement and awareness around climate change as a significant barrier to the take up of sustainable energy measures. Whilst physical and technological changes will be critical to making the necessary carbon emissions reduction cuts by 2050, they can only go so far.

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Changes in human behaviour will also have a big role to play. As pointed out by the Committee on Climate Change, there is significant scope for carbon emissions reduction through relatively minor behavioural changes, such as turning down the thermostat. However, the opposite is also true, And in some cases, physical and technological improvements can be entirely negated unless they are accompanied by appropriate behaviour change. An evaluation of BedZED low carbon development in Sutton, for example, found that while residents exhibit low energy use7, and demonstrate a range of green behaviours, such as food growing, low car ownership and relatively good recycling rates, they also fly more than the average UK resident, emitting an estimated 1.9 tonnes of carbon dioxide a year (Bioregional 2009).

Changes to collective behaviour, beliefs and value systems are considered vital for achieving fundamental social change. The Big Green Challenge8, for example, found that “community- based initiatives can initiate a process of culture change in the community which reinforces and sustains individual behaviour change” (NESTA 2010). In this report, we explore the role that local sustainable energy initiatives can play in realising such change.

2.1.3 Home energy improvement Domestic energy consumption accounted for 27% of the UK‟s carbon dioxide emissions in 9 2006 (149 MtCO2 equivalent per year ) with over 70% of these emissions resulting from space and water heating. A number of recent studies have addressed how an 80% reduction in domestic carbon emissions could be accomplished (Boardman 2007, CSE, ACE and Moore 2008, CAG and EAS 2008). There is agreement that improving the housing stock is one of the most cost-effective methods of reducing UK carbon emissions, but that the investment needed in each dwelling to achieve an 80% reduction will be considerably more than is being provided by current programmes.

For example in ‘How Low – Achieving optimal carbon savings from the UK’s existing housing’ (CSE, ACE and Moore 2008) a wide range of improvement packages were evaluated through computer modelling. The modelling shows that to achieve an 80% reduction in emissions in the existing housing stock it will be necessary to:

 Install the full range of insulation and other energy efficiency measures available.

 Install microgeneration technologies in homes wherever appropriate.

 Achieve further savings through behaviour change.

 Decarbonise the energy supply.

To focus on the costs and impacts, four examples from this modelling exercise are shown in Table 1. The costs are based on typical installation costs under current large-scale

7 BedZED households use 45% less electricity a year, and 81% less heat, than average Sutton residents (Bioregional 2009, p9). 8 The Big Green Challenge. The Big Green Challenge was a £1 million challenge prize run by NESTA designed to stimulate and support community-led responses to climate change. See www.nesta.org.uk/areas_of_work/public_services_lab/environment/big_green_challenge. 9 AEA 2008.

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programmes. Part of the modelling aimed to determine what measures were appropriate to what properties. An average SAP10 rating of over 90 across the whole housing stock is required in order to achieve an 80% reduction in domestic carbon emissions.

What this shows is that the basic package A which is typical of what is being done under many current large-scale programmes such as the Carbon Emissions Reduction Target (CERT) is appropriate only to properties that have cavity walls. These are not the most inefficient dwellings as measured by SAP and only improve the rating by less than 10 points. The cost of package A is fairly modest at £440. Properties receiving this package would in fact require further work to come anywhere near achieving an 80% carbon emission reduction. Package B which includes a full range of insulation measures and a gas condensing boiler would achieve the necessary standard in such properties and costs four times as much.

Packages C and D are much more expensive by an order of magnitude, but they are also capable of raising the SAP rating of properties that might currently be regarded as „hard to treat‟, to a level where an 80% reduction in carbon emissions is achieved. Package D shows the level of investment that is required where measures are included that significantly decarbonise the energy supplied to such properties through the use of microgeneration technologies.

Table 1: examples of costs and impacts of improvement packages Packages of improvement Improvement in average Average installed measures SAP Rating cost A. Loft insulation plus cavity wall 50.8 - 59.6 £444 insulation B. Insulation package (including 53.1 - 92.9 £1,823 cavity wall insulation) and gas condensing boiler C. Insulated dry lining, gas 35.7 - 93.5 £10,334 condensing boiler, solar PV D. External wall insulation, 34 -115.6 £12,221 ground sourced heat pump and solar water heating (Derived from CSE, ACE and Moore 2008 - Annex II)

The costs presented here are similar to the estimate presented by Adair Turner, Chair of the Committee on Climate Change. He predicted that households will need to spend up to £15,000 on a full energy efficiency makeover if the government is to meet its ambitious targets for cutting carbon emissions (Guardian 10/11/09).

The conclusion drawn from these costings and impacts is that to cut CO2 emissions from housing by 80% (which is needed to stabilise climate change) it will be necessary to find:  Considerably more investment for improving the housing stock.

10 The Standard Assessment Procedure is used to measure the energy performance of dwellings. It works outs the typical annual energy costs for space and water heating and lighting. Carbon emissions are also calculated.

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 Ways to reduce the costs of comprehensive packages of improvements that include microgeneration technologies where appropriate.

 Means to accelerate the decarbonisation of energy supply.

The Ashden Award winners provide valuable insights as to how it is possible to address these issues through area-based and community-led initiatives.

2.2 The policy landscape

2.2.1 UK targets Both the UK and Scottish Governments have legally binding targets to cut emissions by 80% by 2050. The UK Government and the Scottish Government have also set themselves a range of short to medium term goals and targets on climate change and energy. Those most relevant to local sustainable energy are summarised in Table 2 below.

Table 2. UK Government and Scottish Government targets on climate change and energy UK Government Scottish Government Emissions reduction Emissions reduction by 2050 on 80% 80% 1990 levels Emissions reduction by 2020 on 34% 42% 1990 levels Emissions reduction from 29% - homes on 2008 levels Energy generation Energy from renewable sources 15% 20% by 2020 Electricity from renewable 30% 50% sources by 2020 Heat generated from renewable 12% 11% sources by 2020 Transport energy from sustainable renewable sources 10% - by 2020 Measures installed % of homes to have smart 100% As UK meters installed by 2020 % of homes to be insulated with loft and cavity insulation where 100% - practicable by 2015 No. of homes to have had an Up to 7 million eco-upgrade by 2020 % of homes to have had ‘whole 100% - house’ treatment by 2030

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2.2.2 UK Government policy The Prime Minister has pledged to make the coalition government “the greenest government ever” (DECC 2010e), and it now has a fantastic opportunity to expand support for energy efficiency and renewable energy. At the time of writing, it has made a number of pledges for achieving this, although the detail is still being developed. It also inherits a range of policies from the previous administration designed to support the delivery of local sustainable energy. Below, we set out the policies in place at the time of the May 2010 election, together with the early commitments of the Coalition Government.

Reducing household emissions: policies and programmes to May 2010 In July 2009, the UK Government (HM Government 2009b) published the National Strategy for Climate Change and Energy, The UK Low Carbon Transition Plan. This set out how the UK Government will meet its carbon targets, so that UK emissions will be 18% below 2008 levels, and one-third below 1990 levels by 2020. Reducing emissions in the home is a key part of these targets. The UK Low Carbon Transition Plan says that by 2050 emissions from homes should be at almost zero (HM Government 2009b). This would be achieved through using energy more efficiently and using more low carbon energy. The plan aims to cut emissions from homes by 29% on 2008 levels by 2020 and sets out a range of actions to achieve this goal. One of these is the Community Energy Saving Programme (CESP), a programme (running from 2009-2012) aimed at delivering significant energy efficiency treatments to 90,000 homes in 100 low-income areas across Great Britain (HM Government 2009c). It is a £350 million programme (just under £4,000 per household11) funded by a new obligation on energy suppliers and electricity generators. CESP promotes a „whole house‟ approach to energy saving, and will be rolled out on a house-by-house, street-by-street basis by community- based partnerships made up of local authorities, community groups and energy companies. It is expected to save almost 2.9 million tonnes of CO2 emissions over the duration of the programme.

Until 2012, CESP will operate alongside other energy efficiency and fuel poverty programmes, including:

 The Carbon Emissions Reduction Target (CERT), an obligation placed on energy suppliers to reduce carbon emissions generated by the domestic sector (DECC, 2010c). This is a much bigger scheme than CESP. It came into effect in April 2008 and is the third phase of a programme that has been running since 2002 to reduce emissions. The previous phase was known as the Energy Efficiency Commitment.

11 Note that this figure is much lower than the estimated costs of more expensive improvement packages highlighted in Table 1.

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 The Warm Front scheme targeted at pensioners and those on qualifying disability or income related benefits, to provide heating and insulation measures which could reduce fuel bills12.

 Decent Homes, a programme to improve the energy efficiency of social housing by April 201113. With the intention of building on this progress, the Government published Warm Homes, Greener Homes: A Strategy for Household Energy Management in March 2010 (HM Government, 2010a). The strategy set out plans to reduce emissions from homes by 29% by 2020. The strategy included four main elements: 1. New community partnerships with an enhanced role for local authorities, including a requirement on energy companies to consult with local authorities to deliver local area- based programmes, as well as support for district heating. 2. Universal standards for the rented sector, including a new Warm Homes standard and proposals for regulation of the rented sector. 3. Invest to save, including replacing the existing CERT mechanism with a new energy company obligation (from 2013), and legislation to enable „pay as you save‟ financing that would provide people with eco-upgrades without upfront costs. 4. Support for consumers, including plans for a universal advice service and new standards for installation. The strategy includes the ambitions that:

 Every home, where practical, has loft and cavity wall insulation by 2015.

 Up to 7 million households will have an „eco-upgrade‟ which would include advanced measures such as solid wall insulation or heat pumps alongside smart meters and more basic measures.

 There will be a wider take-up of district heating in urban areas, including blocks of flats, new build and social housing, and commercial and public sector buildings.

Reducing household emissions: the Green Deal The key policy of the new coalition government for reducing household emissions is the introduction of a new „Green Deal‟ for households (HM Government 2010b), which will encourage home energy efficiency improvements paid for by savings from energy bills. Details of the Green Deal are being developed at the time of writing, although it is likely to be based on plans developed by the Conservatives (Conservatives 2010b).

12 This scheme operates in England only. Similar schemes are run elsewhere in the UK. Scotland operates an Energy Assistance Package, Wales operates the Home Energy Efficiency Scheme and Northern Ireland has the Warm Homes Scheme. 13 The Decent Homes Standard applies to England only. Scotland and Wales have similar standards, the Scottish Housing Quality Standard and the Welsh Housing Quality Standard. In Northern Ireland, the Northern Ireland Housing Executive aims to achieve the Decent Homes Standard within in its own stock.

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These plans set out that every household in Britain would be offered up to £6,500 of approved energy efficiency improvements at no up-front cost, with a higher limit for hard to treat homes. The process would include:

 An independent assessment that would identify the best opportunities for efficiency improvements to homes.

 A kite-marked installer carrying out the improvements.

 The cost of the work being repaid over the long-term from the resulting energy savings and through energy bills payable at the property where the work is done.

The proposal would allow a wide range of private, public and voluntary sector organisations to participate in financing, marketing and delivering improvements under the Green Deal, including banks, investment funds, high street retailers, energy companies, local authorities, housing associations, charities, social enterprises, and community groups.

Wider support for local sustainable energy The previous Government also developed a number of other policies with particular significance for local sustainable energy generation, including:

 Plans to promote the development of a „smart grid‟, including the roll out of smart meters for all consumers, facilitating demand management (HM Government 2009b)14. The coalition Government has put forward similar plans.

 A marked change in the forms of financial assistance that will be used to support energy efficiency measures and small-scale renewable technologies which are styled as „pay as you save‟ and „clean energy cash back‟ schemes to replace current grant programmes. These include:

o £4 million for the piloting of a Pay As You Save (PAYS) scheme in Birmingham, Sunderland, the London Borough of Sutton15 and Stroud, where households - as proposed in the Green Deal - can invest in energy efficiency and microgeneration technologies in their homes with no upfront cost, with repayments spread over a long enough period so that they are lower than their predicted energy bill savings (DECC 2009).

o Feed-in tariffs (FITs) which will enable householders, communities and businesses to receive payments - „clean energy cashback‟ - for the electricity that they generate from small-scale on-site electricity generation (launching

14 The Government has set out a range of proposals for how these smart meters should function. In essence, they will allow for: accurate remote readings of electricity and gas meters, two way communications between the meter and the energy supplier, the provision of „real time‟ information to the householder through an in-home display, a range of „time of use‟ tariffs, remote control of electricity load, remote switching between credit and pre-pay supply, measurement of electricity exported to the grid from the home, and communication with a measurement device within a microgenerator (DECC 2009b). 15 Ashden Award winner Bioregional is one of the partners in the London Borough of Sutton pilot.

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on 1 April 2010, DECC 2010a). The Coalition Government is also now committed to establishing a system of feed-in tariffs for electricity.

o A Renewable Heat Incentive (RHI) which will enable individuals, communities and others to claim payments for the renewable heat that they produce. This is expected to be launched in April 2011 (DECC 2010b), although the Coalition Government had not confirmed this at the time of writing.

Local government and communities: policies and programmes to May 2010 The Low Carbon Transition Plan and the Renewable Energy Strategy (HM Government 2009d) put forward a much-enhanced role for local authorities in energy planning16. This is in part a consequence of the greater emphasis given to the supply and distribution of low carbon heat which is of great significance to local sustainable energy initiatives. Key measures include:

 Linking to the Climate Change Planning Policy Statement and getting local authorities to incorporate energy planning into their decision-making processes and to encourage them to carry out detailed heat mapping and planning.

 £25 million to help fund community heating infrastructure partly through at least 10 exemplar schemes.

 Reviewing local authorities‟ powers and planning guidance to require new developments to connect to heating schemes.

 Introducing new licensing arrangements to make it easier for community energy schemes to interact with the wider energy system.

 Developing an online „how to‟ guide for community energy.

The previous Government also launched pilots for „Local Carbon Frameworks‟ in nine areas in England during 201017. These frameworks will involve local authorities:

 Setting out targets and milestones.

 Developing a strategy for how carbon reductions can be achieved.

 Producing a delivery plan involving all its partners, including all those outside the formal strategic partnership (CLG, 2010).

Finally, the previous Government also created a Low Carbon Community Challenge (LCCC), a two-year research programme designed to test delivery options for achieving cuts in carbon emissions at community level (DECC 2010d).

The LCCC will provide financial and advisory support to 20 „test-bed‟ communities across England, Wales and Northern Ireland. It wants to enable the development of bespoke local

16 Note that most of these local government policies apply to England only. 17 The pilots are taking place in Manchester, Leeds City Region, Bristol, Oxford, Northumberland, Haringey, Nottingham, Plymouth and Bournemouth Poole and Dorset MAA.

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schemes to improve energy efficiency and tackle the wider issue of climate change. It is also designed to:

 Help government understand the potential role of communities in the transition to a low carbon future, and the systems, infrastructure and governance required to make this future a reality.

 Help to establish positive models for community action, and enable the sharing of ideas, stories and information to inspire other communities to launch their own low carbon initiatives.

Local government and communities: coalition Government plans At the time of writing, Coalition Government plans in this area are at an early stage.

On communities, one policy already planned is to encourage community-owned renewable energy schemes by allowing communities that host renewable energy projects to keep the additional business rates they receive.

Perhaps of wider significance are plans to create a „Big Society‟, involving a devolution of power to local authorities, communities, neighbourhoods and individuals. For local authorities, this will include greater financial autonomy, the return of regional decision-making powers on housing and planning issues, reform of the planning system to give neighbourhoods more say in shaping the places they live in, and a consolidation of the national planning framework.

While not mentioned in the coalition‟s programme for government (HM Government 2010b), the Conservatives also envisaged that the Big Society would involve the support and development of neighbourhood groups to take action in their local area: “Our reform agenda is designed to empower communities to come together to address local issues… We will stimulate the creation and development of neighbourhood groups, which can take action to improve their local area.”

Local performance framework Also significant to local sustainable energy projects are the national performance indicators contained within the local government performance framework.18 Delivery against specific indicators is managed through Local Strategic Partnerships (LSPs) as part of the overall delivery of Local Area Agreements.19 These will be significant vehicles in the process of scaling-up current local sustainable energy initiatives (see CAG and Capener 2004). Progress against these indicators, and on climate change mitigation more generally, is monitored and assessed through the Comprehensive Area Assessment (CAA). There are three specific indicators which are of relevance:

 NI 185. Percentage CO2 reduction from LA operations.  NI 186. Per capita reduction in CO2 emissions in the LA area.

18 Note that this applies to England only. 19 Different arrangements operate in Scotland, Wales and Northern Ireland. In Scotland, for example, each local authority has a Single Outcome Agreement with less specific „outcomes‟ on reduction of carbon emissions than set out in the English Local Area Agreements.

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 NI 187. Tackling fuel poverty - % of people receiving income based benefits living in homes with a low and high energy efficiency rating (HM Government 2008).

The application of these indicators is effectively the replacement for the Home Energy Conservation Act (HECA). HECA was identified in From Policy to Practice (IPPR and Ashden Awards 2009) as the third most helpful policy by practitioners. The introduction of Local Carbon Frameworks, described above, would increase LA expectations and responsibilities even further.

Significantly, the coalition Government has pledged to cut local government inspection and abolish the CAA. It is not clear whether any new, albeit streamlined, performance framework would include similar drivers for local partnership performance on climate change and local sustainable energy.

2.2.3 Scottish Government The Climate Change (Scotland) Act 2009 creates a statutory framework for reducing greenhouse gas emissions in Scotland. The Act sets an interim 42% emissions reduction target from 1990 levels by 2020, with an ultimate target of an 80% emissions reduction for 2050 on 1990 levels. This gives Scotland the challenge of going further than the rest of the UK in reducing emissions by 2020. Ministers in Scotland have also set challenging targets on renewable energy, with a target of 50% of Scottish electricity to be supplied from renewable sources by 2020, and an interim milestone of 31% by 2011. A target has also been set for 11% of Scotland's heat to be met from renewable sources by 2020. To help achieve these targets, the Scottish Government has developed a number of policies, in addition to those mentioned above, that will impact on local sustainable energy generation in Scotland:  A Climate Change Delivery Plan (The Scottish Government, 2009a), which sets out how Scotland will meet its statutory climate change targets. This includes chapters on „electricity demand and supply‟ and „heat demand and supply.‟ The latter includes a focus on small-scale electricity generation.  An Energy Efficiency Action Plan, which has been through consultation (Scottish Government, 2009b) and is due for publication in 2010.  A Home Insulation Scheme (Scottish Government, 2010a), an area-based scheme aimed at improving the energy efficiency of homes. The scheme offers free energy efficiency advice and audit, virgin loft20 and cavity wall insulation, loft top-up insulation and other energy measures. The scheme originally aimed to reach to up to 100,000 households in 2009-10, but this has since been extended to 190,000 homes, supported through £15m of Scottish Government funding. The 2010-11 Scottish Budget allocated another £15m to extend the scheme to a further 90,000 households in 2010-11 (Scottish Government 2010b).  A Universal Home Insulation Scheme (UHIS), which will run 2010-11. This is a £10m area-based scheme, which will be targeted at 90,000 homes (Scottish Government, 2010b). The Scottish Government‟s initial proposal for UHIS suggests that it will be very similar to HIS. The key difference between UHIS and HIS is that UHIS also

20 A „virgin loft‟ refers to a loft with no insulation.

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includes offering free virgin loft and cavity wall insulation to all households in the area irrespective of their ability to pay.  The Energy Assistance Package (EAP), which has replaced the Central Heating and Warm Deal schemes. The EAP aims to provide a holistic package to help maximise incomes, reduce fuel bills and improve the energy efficiency of homes (Scottish Government, 2010e).  An Energy Saving Scotland Home Loans Scheme, which offers interest-free loans of between £500 and £10,000 to householders for energy efficiency and small-scale energy generation measures such as cavity wall insulation, loft insulation, solid wall insulation, wind turbines, solar water heating, heat pumps, small scale hydroelectric schemes, wood fuel heating systems and the replacing of old and inefficient boilers (EST Scotland, 2010).  The Climate Challenge Fund (Scottish Government 2010c), a three-year programme (2008-11) which will make £27.4m available to individual community groups and community planning partners to implement actions to reduce carbon emissions in their local area.  A Renewables Action Plan (Scottish Government 2009c), which includes a framework for action on delivering community renewable.  A Renewable Heat Action Plan for Scotland (Scottish Government 2009d), which sets out a range of actions to support the development of renewable heat across all sectors, particularly on skills, consumer information, supply chain development and supporting investment.  The Scottish Government Communities and Renewable Energy Scheme (Scottish Government 2010d, CARES), which provides project advice and financial assistance to communities developing renewable energy projects.

2.2.4 Welsh Assembly Government

The Welsh Assembly Governments has less powers and responsibilities in relation to energy matters, compared with Scotland. Nevertheless, it is still taking action to support the development of local sustainable energy solutions. One significant initiative is the Community Scale Renewable Energy Generation (CSREG) project. This £8m initiative will provide finance of £100,000 to £300,000 per project to support the development of community based renewable energy schemes. The aim is to enable around 22 new and existing social enterprises to install micro-generation. The electricity generated from the projects can either be used by the groups themselves, or sold onto the National Grid or to local communities, providing an on-going source of income.

The initiative will also provide 135 small grants worth £3,000, which will be offered for local communities to carry out feasibility studies into potential renewable energy initiatives, with 35 grants worth up to £20,000 available to help develop the most suitable projects.

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Two other policies are also worth noting:

 The Welsh Assembly Government is developing a Wales Climate Change Strategy, due for consultation in 2009, but not published at the time of writing (WAG 2010a).  A National Energy Efficiency and Savings Plan (WAG 2010b), which went to consultation in 2009. The final plan will set out practical actions to help achieve energy efficiency and fuel poverty objectives.

2.3 The economic landscape

Public spending - the big squeeze We are entering a prolonged period of very constrained public spending. At the time of writing, the coalition Government has already announced £6.2bn of savings in public expenditure in 2010-11, and further cuts will be set out in the June 2010 budget.

This provides a very different context to that in which many of the Ashden Award winners have operated to date. It must put a question mark against the prospects for approaches that are heavily dependent on public spending (e.g. Kirklees Warm Zone) and might indicate that approaches that are self-funding or supported largely by mandated finance (such as from energy suppliers as planning gain) are now more significant (e.g. Hadyard Hill).

Unemployment and greening the economy As a result of the credit crunch and the recession, much policy debate is now being focussed on how gains for the economy can be achieved through cutting carbon emissions. The debate is coalescing around the idea of a „Green New Deal.‟ which was already being promoted by environmental pressure groups, the Green Party and the New Economics Foundation (NEF 2008) amongst others even before the main political parties took up the theme. The second report of the Green New Deal Group is entitled ‘Cuts won’t work’ (NEF 2009) and strongly advocates „green quantitative easing‟. The authors provide examples of the impacts £10 billion in green quantitative easing invested in the energy efficiency sector could create:

 60,000 jobs while reducing emissions by 3.96 million tonnes of CO2 per year.

 Public savings of £4.5 billion over five years in reduced benefits and increased tax intake alone.

In their manifestos, both the Conservatives (2010b) and the Liberal Democrats (2010) recognised the opportunities for stimulating the green economy. At the time of writing, the coalition Government‟s main pledge on this agenda is to establish a green investment bank, including the creation of green financial products to invest in the infrastructure needed to support the green economy (HM Government 2010b).

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3. Learning from success: what has been achieved?

Chapter summary There are a diverse range of innovative and successful local sustainable energy initiatives in the UK, as highlighted by Ashden Award winners.

Area-based energy efficiency approaches are an increasingly common and much-championed type of local sustainable energy initiative, Ashden Award winners have been at the forefront of developing this type of approach and our research has focused on two examples in particular: Kirklees Warm Zone and the Hadyard Hill scheme, run by the Energy Agency in Ayrshire.

Both schemes have been very successful. They demonstrate that area-based approaches can deliver significant levels of take-up and coverage, deliver significant economies of scale, offer a number of wider benefits such as local job creation and can work in rural as well as urban areas.

Our research has also highlighted a range of other local sustainable energy initiatives that also offer real benefits both in terms of carbon savings and wider sustainability gains. They offer approaches which  Prime and support communities to take ownership and action on carbon reduction.  Develop local energy supply and generation.  Develop local supply chains, creating local jobs.  Support energy intelligent businesses.  Develop a long-term low carbon vision for a neighbourhood.

3.1 Local sustainable energy initiatives

As outlined in chapter 2, local sustainable energy initiatives can play a crucial role in delivering a low carbon economy. They can delivery significant physical and technological change through energy saving measures and small-scale renewables. And they are also ideally placed to support individual and collective behaviour change.

3.1.1 What are they? Local sustainable energy initiatives:

 Focused on a defined spatial area. Depending on the nature of the initiative, this area could be as large as a region (e.g. North-West England) or as small as a

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street. More usually, it is focused around a single town, village, neighbourhood or sub-region.

 Involve one, or a combination of, energy efficiency, renewable electricity or renewable heat.

 Are often local in that they are often unique to that area, being the result of local entrepreneurship and tailored to the needs of the area in question.

In this chapter, we pay particular attention to a wide range of such initiatives, focusing in particular on one type of local sustainable energy initiative, namely area-based energy efficiency schemes.

3.1.2 Case study examples Throughout this report there are extensive references to case study examples of local sustainable energy initiatives and to their experiences and successes. Some of these initiatives are at different stages. Some have a track record of proven success, such as the Ashden Award winners. Others are less developed or recognised, but provide interesting insights nonetheless.

Table 3 summarises the main case study examples that we refer to throughout this report alongside key references from which information has been drawn. They are grouped by broad types of initiative, although many overlap and so are not exclusively limited to that category.

Table 3: case study examples of local sustainable energy initiatives

Name of initiative Information sources

Area-based energy efficiency schemes Ashden Kirklees Warm Zone is an initiative of Ashden Award Winners project Award Kirklees Council in Huddersfield, West summary Winner Yorkshire. It is a large-scale urban www.ashdenawards.org/winners area-based initiative covering 170,000 dwellings where cavity wall and loft Interview with Phil Webber of Kirklees insulation is offered free on a non- Council (08/01/2010) means tested basis. Cambium Advocacy (2009)

Ashden Hadyard Hill Community Energy Ashden Award Winners project Award Project in South West Scotland is led summary Winner by the Energy Agency in partnership www.ashdenawards.org/winners with the local community. The project is a small-scale rural area based Interview with Liz Marquis of the Energy initiative covering 828 dwellings. Agency (30/12/2009) Finance derived from an energy efficiency fund from a local wind farm is Cambium Advocacy (2009) being used to provide free cavity wall, loft insulation and draught-proofing in

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local homes. Warm 5 Pilot Warm Zones were established CSE/NEA (2005) Zones early in 2001 and the pilot period ended in March 2004. They were located at Stockton, Newham, Sandwell, Northumberland and Hull. They were all urban initiatives focused on tackling fuel poverty and improving energy efficiency in the households in each zone. All involved partnerships between the local authority and an energy supplier with various other partners such as installers and energy advice centres.

Climate Fintry Community Energy Project in Interview with Liz Marquis of the Energy Challenge Stirlingshire is led by the Fintry Agency (30/12/2009) Fund Development Trust in partnership with the Energy Agency. The project Cambium Advocacy (2009) is a small-scale rural area based initiative covering 333 dwellings. Fintry Development Trust (2009) Finance derived from community www.fintrydt.org.uk/uploads/Report.pdf ownership of a wind turbine is being used to provide free cavity wall, loft insulation, draught-proofing and other measures in local homes. More costly measures such as microgeneration are being considered.

Renewable energy initiatives Ashden Isle of Gigha community-owned Ashden Award Winners project Award Windfarm was a project facilitated by summary Winner Ashden Awards winner ALIEnergy, www.ashdenawards.org/winners working with the Gigha Community Trust. The three-turbine, 670 kW wind Isle of Gigha: farm supplies 75% of the electricity www.gigha.org.uk/windmills/TheStoryof needs for the island of Gigha. This is theWindmills.php Scotland‟s first community owned, grid connected, windfarm and generates an annual income of around £75,000 for the community. Part of this income is being used to fund energy efficiency improvement on the island.

Big Green Isle of Eigg Electrification Scheme NESTA (2010) Challenge has been developed by the Isle of Eigg Winner Heritage Trust to serve 37 households Big Green Challenge finalists and five commercial properties. The www.nesta.org.uk/areas_of_work/public scheme generates power at a number _services_lab/environment/big_green_c of locations around the island, from the hallenge/finalists_big_green_challenge renewable resources of hydro electric,

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wind and solar energy, and makes this Isle of Eigg: available to all households and www.isleofeigg.net businesses via an island wide high voltage distribution grid. The renewable Community Energy Scotland (2008) energy meets over 95% of the island's electricity demand.

Ashden District Heating from Local Tree Ashden Award Winners project Award Waste in Barnsley is a project summary Winner developed by Barnsley MBC. The www.ashdenawards.org/winners council is using tree waste sourced within a 15 mile radius to fuel wood- Energy Efficiency North: fired boilers. As of 2010 the initiative www.efficiencynorth.org/system/files/do has developed wood-fired boilers in 10 cuments/Barnsley%20Biomass%20Hea locations covering flats, and municipal ting%20Systems%20final.pdf buildings. Further plans include local schools and Barnsley market. Bradford (2008) www.berr.gov.uk/files/file49267.pdf

Behaviour change initiatives Ashden Low Carbon Communities is a Ashden Award Winners project Award programme run by the Marches Energy summary Winner Agency (a social enterprise) in rural www.ashdenawards.org/winners Shropshire. The agency provides a range of support tailored to particular Low Carbon Communities: communities focused on a defined CO2 www.lowcarboncommunity.org reduction over time. This includes „portfolio funding‟ whereby the MEA team Interview with Richard Davies of ensure all resources from any available Marches Energy Agency (08/01/2010) source are used to support action. Work up to 2009 has focused on six rural Site visit to Marches Energy Agency communities with over 2000 people (November 2009) having benefited directly. The Greening Campaign is a structured Interview with Terena Plowright programme that supports communities to (18/12/2009) take the first steps in making themselves more sustainable, moving from individual Greening Campaign: behaviour change to collective action and www.greening- more substantial physical improvements. campaign.co.uk/About.html Community-led initiatives Big Green The Green Valleys is a community-led NESTA (2010) Challenge initiative in the Brecon Beacons Winner National Park. The initiative serves Big Green Challenge finalists: more than a dozen small rural www.nesta.org.uk/areas_of_work/public communities with a total population of _services_lab/environment/big_green_c 30,000. Micro-hydro schemes are being hallenge/finalists_big_green_challenge developed by the local communities and farmers to generate an income to The Green Valleys: finance further carbon emission www.thegreenvalleys.org

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reduction measures. These include energy efficiency in buildings, growing food locally, sustainable transport and woodland management to supply fuel- wood. The initiative‟s aim is to make the area zero carbon and a net exporter of renewable electricity.

Big Green Low Carbon West Oxford is a NESTA (2010) Challenge community-led initiative in an urban Runner up area with 1600 households and 160 Big Green Challenge finalists: businesses. The community is working www.nesta.org.uk/areas_of_work/public together on energy efficiency with 35 _services_lab/environment/big_green_c households and five businesses each hallenge/finalists_big_green_challenge year. The resources to support this work are provided by West Oxford Low Carbon West Oxford: Community Renewables, an industrial www.lowcarbonwestoxford.org.uk and provident society for the benefit of the community that is developing a portfolio of renewable energy projects (primarily photovoltaic arrays).

Developing local supply chains Ashden Renewable Energy for Devon (RE4D) Ashden Award Winners project Award is a partnership of Devon County summary Winner Council and other local organisations www.ashdenawards.org/winners set up to safeguard local jobs, support the local green economy and cut Interview with Melanie Sealey, RE4D carbon emissions. (January 2010) Supporting energy intelligent businesses Ashden ENWORKS is a regional partnership in ENWORKS 2001 - 2010 +: Award North West England aimed at delivering www.enworks.com Winner support to businesses on energy and resource efficiency. Interview with Samantha Nicholson (January 2010) The Marches Energy Agency‟s Low Low Carbon Enterprise: Carbon Enterprise programme www.lowcarbonenterprise.org.uk/ provides impartial technical support and project delivery capability to public, Interview with Richard Davies of private and third sector organisations, Marches Energy Agency (08/01/2010) including over 100 SMEs across four communities in Shropshire. Site visit to Marches Energy Agency Planning-led initiative Hackbridge Sustainable Suburb is an Tibbalds (2009) initiative of the London Borough of Sutton in partnership with Ashden One Planet Sutton website: Award winner Bioregional. This initiative www.oneplanetsutton.org/hackbridge aims to transform the Hackbridge district of Sutton into a „sustainable Interview with Sue Riddlestone of suburb‟. This is an example of a Bioregional (January 2010)

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planning-led area based approach. A masterplan has been drawn up and extensive community consultations have taken place. The programme is in development and is not yet delivered.

3.2 Area-based energy efficiency approaches

3.2.1 The shift towards area-based energy efficiency approaches „Area-based‟ energy efficiency approaches are an increasingly common and lauded type of local sustainable energy initiative.

The Energy Saving Trust (EST) (2009) defines an area-based approach as one that “delivers energy efficiency measures in a spatial area. This could be a street, neighbourhood, a local authority area or a group of local authority areas”. Kirklees Warm Zone, and other Warm Zones, Hadyard Hill, Fintry, Community Energy Plus Home Health and Cumbria Energy Efficiency Advice Centre are all delivering variations of this type of approach.

Such approaches are now championed by many (for example Boardman 2007, CAG and Energy Action Scotland 2008, EST 2009, LGA 2009) as an excellent means of rolling out energy improvements. The Energy Saving Trust (EST, 2009, p2) say that “they are one of the most proactive and cost-effective methods for achieving significant CO2 reductions … [and] have been proven to be much more effective than costly blanket approaches known as „pepper-potting‟ that use little marketing intelligence to inform their delivery.”

This view of the way forward for reducing household emissions is strongly backed by the government advisory body - the Committee on Climate Change - that monitors the UK‟s progress on carbon emission reduction targets. A key recommendation of its 2009 assessment on progress was that the UK Government needed to:

“Make a major shift in the strategy on residential home energy efficiency, moving away from the existing supplier obligation, and leading a transformation of our residential building stock through a whole house and street by street approach, with advice, encouragement, financing and funding available for households to incentivise major energy efficiency improvements (Committee on Climate Change 2009)”.

3.2.2 Key elements of an area-based approach Ashden Award winners have been at the forefront of developing this type of approach (e.g. Kirklees Warm Zone as a large-scale urban example and the Hadyard Hill project in rural South Ayrshire on a much smaller scale).

Area-based approaches typically include most, if not all, of the following elements:

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 The local authority working in partnership with the local community, energy suppliers, installers and other local organisations. At Hadyard Hill the project was led by the Energy Agency on behalf of the local authority.

 Area-based delivery to gain economies of scale.

 Combining funding from several different sources such as the local authority‟s housing budget, CERT and other funding from energy suppliers.

 Intensive marketing campaign often using door-to-door leafleting and backed up by dissemination and support through trusted community networks.

 Trained assessors making door-to-door visits to check the current energy efficiency of dwellings and to identify appropriate measures for each household.

 A main focus on basic insulation measures such as cavity wall, loft insulation and draught proofing, sometimes accompanied by more advanced measures (e.g. the Hadyard Hill project also included solar thermal systems).

 Some projects have offered measures at no cost to the householder and without means testing (e.g. Hadyard Hill and Kirklees Warm Zone) but this has not necessarily been a feature of other area-based schemes.

 Many area-based schemes offer support to low-income households to ensure they are receiving their full social security and benefit entitlements.

Kirklees Warm Zone

The Kirklees Warm Zone is probably the most well-known - and successful - example of an area-based energy efficiency approach.

Kirklees Council has worked in partnership with Scottish Power (CERT funding), Yorkshire Energy Services (Warm Zone manager) and Miller Pattison (installer) to create the Kirklees Warm Zone, a large-scale area-based approach to install basic home insulation measures (cavity wall and loft insulation). The Warm Zone includes the towns of Huddersfield and Dewsbury, and several other towns and villages in this part of West Yorkshire. The borough has a population of 401,000 people living in 171,000 households (157,000 occupied homes – i.e. excluding empty properties).

Both Kirklees Council and Scottish Power contributed £10 million to finance the Warm Zone with the largest part of the local authority‟s contribution being derived from the sale of its share in the local airport. All households in the district have been visited by trained independent assessors under contract to Yorkshire Energy Services. Where additional insulation is required they arrange for a contractor to install mineral-fibre insulation in lofts and cavity walls at no cost to the homeowner.

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By March 2010 (three years from the start), the Warm Zone has benefited the community in a number of ways:

 35,500 tonnes CO2 equivalent savings each year.  25% of the local population had benefited from energy efficiency measures with some 38,000 lofts insulated and 18,000 cavity walls filled.  The creation of 129 local jobs as installers with Miller Pattison and as assessors and administrative staff at Yorkshire Energy Services.  A significant reduction in fuel poverty.  £8million of fuel bill savings per year.  Increased awareness and uptake of state benefit support by eligible residents.  The distribution of carbon monoxide detectors and 25,800 referrals for fire safety checks. Success of an area-based approach in rural South West Scotland

A recent analysis carried out for WWF Scotland (Cambium Advocacy 2009) assessed the impact of three area-based schemes modelled on Ashden Award winner the Hadyard Hill project. The non-means tested schemes in Hadyard Hill, Fintry and Girvan were compared with what had been achieved by the Scottish Government‟s Warm Deal programme which is not area-based, but provides a similar range of measures on a means tested basis. The three area-based schemes showed a generally better level of performance than Warm Deal.

The average cost to achieve £1/year savings on fuel bills by those receiving energy efficiency measures across the three projects was £1.85 compared to £2.45 for Warm Deal. Annual energy usage of treated houses in the three area-based schemes fell by between 18% and 24%.

The average cost to save one tonne of carbon dioxide per year across the three projects was £328 compared with £356 for Warm Deal. On average the households in the three area-based schemes saved between 1.3 and 3.1 tonnes of carbon dioxide per annum, averaging a 19% reduction in emissions.

In addition acceptance rates by households having surveys and reports ranged from 72% to 90% in the three area-based schemes. The Energy Agency reported that in other non- area-based programmes the response rate achieved was usually around 10%. This high response rate and the concentration of leads is a key factor in the lower delivery costs of the area-based schemes.

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3.2.3 Take-up and coverage A key challenge for many national programmes to cut carbon emissions is to achieve „good levels of take-up‟. This means that a significant number of energy users, whether domestic or commercial, are responding to initial contacts and also then implementing measures.

The experience of two Ashden Award winners shows that very high take-up rates and wide coverage is based on the trust resulting from community endorsement and involvement, good customer care (discussed later) and the availability of universally-free measures. Their performance is shown in table 4.

Table 4: take up of measures in Ashden Award winners area-based initiatives Name of Total Number of % take up of % take up of initiative households households initial measures in area contacted assessment (number) (number) Kirklees Warm 157,000 82% of 62% 68% Zone21 occupied occupied homes (97,366)22 (107,159) referred homes (129,453) for detailed surveys

25% (40,000) had measures installed by March 2010 Hadyard Hill 828 96% 90% 57% (791) (748) (469)

Comparing the performance of area-based schemes, both with other area-based schemes and with non-area based schemes is problematic for a number of reasons. Success can vary depending on the context in which they work in (e.g. some contain very high numbers of hard-to-treat homes), the approaches to marketing they adopt, the scope of the projects (some go beyond physical measures and into „softer‟ or behavioural measures that are more difficult to measure), the stage of delivery they are at, and inconsistency in the way data is collected and reported.

Nonetheless, the figures from Kirklees and Hadyard Hill suggest that these area-based approaches have achieved a high take up. Indeed, the success of these and other schemes has led the Committee on Climate Change to assert that a move towards more area-based schemes would deliver more carbon savings than CERT, the UK Government‟s current key scheme for improving household energy efficiency.

On the basis of analysis (Element Energy 2009, p159), the Committee concluded that take- up of measures under the main existing scheme (CERT) would be insufficient to deliver on

21 The Kirklees initiative is ongoing. Figures reflect progress by end of March 2010. 22 In Kirklees a proportion of the households visited were council-owned and therefore not eligible for measures, but were offered all other support.

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national targets as it would deliver less than half of the emissions reduction potential. On the basis of the poor take-up being achieved under CERT, the Committee on Climate Change has made strong recommendations for an immediate and significant change of direction to an area-based approach.

The Committee on Climate Change also pointed to the disappointing results for installations of solid wall insulation measures. Government had projected that CERT might result in 150,000 solid wall insulation installations in the period 2008-2011. CERT actually delivered only 8,600 installations in its first year - just 5.7% of the Government‟s projection. There is as yet insufficient information to say whether area-based schemes can deliver a better take-up rate than CERT. The current CESP programme could provide this evidence.

3.2.4 Costs and cost-effectiveness A review of other energy efficiency schemes revealed that there is currently little in the way of meaningful, comparable data on the costs of schemes.

However, the two schemes highlighted here suggest that good value for money can be achieved from area-based approaches. The cost of the schemes has been around £20million. With around 40,000 measures installed to date, the cost per measure has been approximately £500. The total cost of three Energy Agency schemes, covering 4167 properties, was £771,000 (Cambium Advocacy, 2009). With 1,584 measures installed, this gives an average cost per measure of £487.

High take-up rates are a significant factor in reducing costs. These cost reductions are the result of the much improved productivity of installers where there is a small distance between jobs. In the Kirklees Warm Zone the next job may well be the next house. Kirklees Warm Zone has found that the delivery of measures is showing productivity levels 50% higher than those experienced on comparable national programmes.

Costs can also be reduced through the economies of scale that area-based schemes can achieve. EST (2009) say that area-based approaches are up to 30% lower than their individual cost as a result of bulk purchase of insulation. However, achieving economies of scale is easier in urban areas than in rural areas where transport and storage costs, for instance, can make a significant difference.

Making comparisons between the costs of schemes is not straightforward. There is no consistent reporting framework for such approaches and so there are variations in the way data is collected, the way costs are calculated (e.g. whether they include the CERT subsidies or not) and because of the differences in the nature of the schemes and the types of measures that are installed.

3.2.5 Wider benefits Area-based approaches can also deliver a number of wider benefits. These include:

 Local economic benefits. Involving local installers can create jobs and improve skills in the local area. EST (2009) say that research in the South East of England has shown that an average local authority running a three year area-based programme to insulate 46,000 lofts and cavities in their area could create 90 jobs. The Kirklees Warm Zone initiative has created 129 full-time equivalent jobs. It

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estimates that every £1 invested in the scheme returns £4 into the local economy (Travers and Arup, 2009). In Hadyard Hill 2 local surveyors were trained and employed for the project, along with a project manager (Cambium Advocacy, 2009).  Increased disposable income. The Kirklees Warm Zone expects to deliver annual fuel bill savings of around £200 to around 50,000 households when the scheme is completed (Audit Commission, 2009). In the Energy Agency Ayrshire schemes, annual disposable income in the community increased by £162,000 in Fintry, £561,000 in Girvan and £176,000 in Hadyard Hill. In both cases, the increases in disposable income can be expected to lead to indirect economic benefits, as local residents can spend on other things, including local goods and services (Ashden Awards, 2009)  Benefit checks. The Warm Zone schemes have incorporated benefit checks, securing an additional £18 million in income for low-income households  Improved health. Area-based schemes can lead to improved housing conditions and reductions in fuel poverty, which in turn can lead to improved health, reduced hospital admissions and can enable vulnerable people to live independently at home (Audit Commission, 2009).

3.2.6 Utilising an area-based approach in urban and rural areas There is a common concern that urban areas are more likely to be favoured for area-based schemes, partly because of the economies of scale that can be achieved, and also because poverty indicators, such as the Index of Multiple Deprivation which is used to determine where CESP schemes can happen, score higher in urban areas. Schemes such as the Kirklees Warm Zone have amply shown the success of the approach in urban areas.23 Meanwhile, early indications from the CESP suggest that this will focus predominantly on urban areas - the first ten schemes, announced in October 2009 by British Gas, all focus on urban areas.

On the other hand, there have been some questions asked about the applicability of the area-based approach to rural areas. There is a particular concern that rural areas tend to have a high proportion of fuel poor, with many properties off the gas grid and paying for increasingly expensive oil and Liquefied petroleum gas (LPG). However, our research has demonstrated that area-based schemes can also work successfully in rural areas. Detailed below is an example of the successful development of area-based schemes in the dispersed communities of South West Scotland.

3.2.7 Key lessons  Area-based approaches can deliver significant levels of take up and coverage, especially when they are universally free.

 Significant economies of scale can be achieved through area-based approaches. This can make area-based approaches a cost-effective way of rolling out energy efficiency improvements.

23 Note, however, that 13% of Kirklees residents live in rural or urban fringe settlements.

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 A number of wider benefits can also be achieved, including local employment and job creation, increased disposable income, benefit checks and health improvements.

 Area-based approaches can work in rural as well as urban areas.

3.3 Other approaches to delivering local sustainable energy Our research has also highlighted a range of other local sustainable energy initiatives that are helping to move neighbourhoods towards a low carbon future. These offer real benefits both in terms of carbon savings and wider sustainability gains. These could significantly enhance area-based approaches, through adding in additional elements including community engagement, behaviour change, renewable energy, supporting businesses, and long-term visioning and planning. These are explored below.

3.3.1 Priming and supporting community action

Participants at the practitioner workshops highlighted that local sustainable energy initiatives can benefit from strong community involvement. Indeed, the work of many Ashden Award winners already demonstrates this.

Community involvement can come in a variety of forms. In some instances, „strong communities‟ take the lead and develop their own initiatives (as will be discussed later on in the report). In other instances, local sustainable energy initiatives can work with communities to both „prime‟ them to take action, improving the likelihood of them taking up behavioural and physical measures, and to mobilise them to achieve wider progress towards a low carbon future.

The boxes below highlight two examples of how working with communities has increased understanding, improved behaviours and laid the ground for physical measures and real cuts in carbon emissions.

Priming community action

The Greening Campaign is a structured programme with three phases which supports communities taking their first steps towards sustainability, reducing their impact on climate change and planning for adapting to future climate change.

The programme is designed to excite communities, make it fun and to move towards being self-sustaining. The first phase involves households making small (largely behavioural) changes, such as switching the lights off when they leave the room, turning off inactive appliances and turning the thermostat down by one degree.

From these modest successes, they move onto bigger actions in the second phase. These involve the community acting together, for example local food initiatives and insulation and water saving programmes. They make full use of peer pressure as a motivator for action. The third phase - a community climate change adaptation toolkit - will be launched in July 2010.

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In the community of Wallingford, Oxfordshire, 757 of the 3193 households took part in the first phase of the Greening Campaign and saved an estimated 384 tonnes of CO2 per year through behavioural measures alone. By December 2009 the campaign had saved 2,155 tonnes of CO2 in total and is now working in over 180 communities. This approach is involving an average of 13% of the population in recipient communities actively involved. The highest involvement achieved for phase one is 24%. The percentage typically increases when the community begins phase two.

The Campaign is now working with installers to move onto large-scale retrofit programmes. These are based on initiatives where participants have already educated themselves about the issues and are motivated by having already achieved some cuts in emissions.

Mobilising communities in the Midlands

Ashden Award winner Marches Energy Agency (MEA) is another organisation that has worked with communities on an area-basis. It has worked with communities in the West and East Midlands through its Low Carbon Communities (LCC) Programme to encourage them to take action to reduce their energy use and carbon emissions, providing them with support and training to achieve these goals. By March 2010 LCC had run with 15 communities in total, with several more about to join the programme, saving over 2,000 tonnes of CO2 annually and directly benefitting more than 2,500 people.

The LCC programme works closely with the other strands of MEA‟s work. For example, work might begin in a community with an energy-themed pub quiz or film night run by MEA‟s communication and education programme, Carbon Forum. LCC will then follow this up, working with the community to reduce their emissions. This includes practical advice on behavioural measures as well as advice on how to get technical measures installed. LCC tends to be delivered where there is already a local group in existence - such as a Transition Initiative - as this provides an „in‟ to the community. LCC will typically work with a community for 24 months, with the aim that at the end of that period the community will have gained sufficient enthusiasm, knowledge, skills and confidence to continue taking further action to reduce emissions.

3.3.2 Supporting local energy supply and generation Many successful local sustainable energy initiatives involve the development of a localised - and sometimes community-owned - energy supply.

Ashden Award winner ALIEnergy, which operates on the west coast of Scotland, helped communities to develop a sustainable energy supply as a precursor to their area-based energy efficiency schemes.

The most advanced example is possibly the Island of Gigha. With the expert help of ALIEnergy the islanders installed three wind turbines with a capacity of 670 kW which provide the community with 75% of their electricity requirements and an annual net income

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of around £75,000 from electricity sales. The revenues from the electricity sales from this small wind farm pay off the loan for the capital costs, but also provide a substantial contribution to the Gigha Community Trust. The Trust then funds energy efficiency improvements in the island‟s homes (the financial model for this project is discussed later).

This is just one example of how a deeper level of action to cut carbon emissions has been encouraged by community ownership of energy supply. This could be a significant additional feature to the area-based approach described in the previous section.

An alternative approach to energy supply is demonstrated by another Ashden Award winner, Barnsley Metropolitan Borough Council (MBC). Barnsley MBC was heavily dependent on 133 outdated and polluting coal-fired boilers for heating 66 of its premises, including 26 district heating schemes. By 2004 many of these boilers were due for replacement. It took the decision to progressively replace these boilers with wood-chip fired biomass boilers as a way of cutting carbon emissions. Two of the early replacements involved the completion of a 470 kW wood-fuelled district heating scheme for 166 flats, and a 500kW scheme for the council depot. Wood chip boilers have also been installed in new buildings, instead of gas, such as the installation of a 500kW boiler at Barnsley MBC‟s civic headquarters. The wood-chip is processed from wood residues and coppice wood from woodlands and parks in the area around Barnsley. A new, local wood supply business has been created as a result of this development.

Similar initiatives to that in Barnsley are being developed by other Ashden Award winners in other parts of the UK, such as Bioregional‟s project to develop wood fuel supply chains, including a tree station in Croydon (Ashden Awards 2006).

Including energy supply in an area-based approach allows for the more comprehensive range of measures necessary for deep cuts in carbon emissions. An important aspect of this is the development of local heat distribution networks that will increase the viability of small-scale renewable energy generation. It also offers important collateral benefits for the local economy. For example by connecting fuel supply chains to locally sourced wood fuel, it creates local jobs and strengthens the local economy.

3.3.3 Developing local supply chains, creating local jobs Local sustainable energy initiatives can also bring together key partners to develop supply chains for renewable energy fuel supply and installation, and expand the number and capacity of local installation companies. Detailed below is a successful example of how to provide this type of support and how it can provide commercial opportunities and benefits for the local economy.

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Supporting the successful development of renewable energy in Devon

In 2006 Devon County Council and other partners set up Ashden Award Winner Renewable Energy for Devon (RE4D) to create and safeguard jobs and cut CO 2 emissions.

In the first phase, it gave advice to 486 individuals and organisations, providing over five days of mentor support to each of 99 businesses and social enterprises. Advice was also given to schools, public sector organisations, communities and households. In total:  £250,000 was given in capital grants.  109 renewable energy systems were installed.  37 local renewable energy installers were supported, with 20 receiving over five days support  55 new jobs were created in the renewable energy sector and combined turnover rose from £7m to £11m.  £4.2m Energy savings totalled £4.2m for SMEs.  10 technology growth plans were produced.

As of June 2009, 694 tonnes of CO2 are saved per annum, equivalent to the emissions of 282 homes, and the renewable energy sector in Devon has grown quicker than other equivalent areas. As of January 2010, over 90 renewable energy jobs have been created.

Partnership working lies at the heart of the successful operation of RE4D. The partners include the main funder, Devon County Council, but also a number delivery partners.

RE4D is tied into the community in Devon through these partners such as the Devon Association for Renewable Energy (DARE). DARE is a delivery partner and is a grassroots not-for-profit membership organisation, managed by elected directors. DARE was formed by five people who were brought together as representatives of their communities for a European funded project. DARE is completely independent and receives no core funding, being funded by membership subscriptions and consultancy work, but some services are still provided voluntarily by its directors. DARE provides mentoring support for community clients, as well as technical support for other client „mentors‟.

3.3.4 Supporting energy intelligent businesses If area-based initiatives are to move beyond the domestic sector they the need to involve local businesses and to provide appropriate support to enable them to cut their own carbon emissions as part of improving their economic efficiency.

The experience of one Ashden Award winner, ENWORKS, shows that a regionally based partnership can deliver support to businesses at the local level, while ensuring strategic alignment with regional and national policies and programmes of work.

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Regional partnership delivers local support

ENWORKS is a regional partnership operating since 2001 in the North West of England that includes the RDA, Environment Agency, North West Chambers of Commerce, plus a number of national groups. It provides support to business of all sizes, from all sectors and in all locations on energy and resource efficiency (including materials and water) and on environmental business risk (e.g. compliance with environmental regulations and adapting to climate change). At the end of 2009 ENWORKS received approval for £9.9 million of investment to extend its existing service and continue to offer specialist support to the region‟s businesses until 2013. This funding is from the Northwest Regional Development Agency (£6.4 million) and the European Regional Development Fund (£3.5 million).

The impact of the service ENWORKS is currently providing support to over 1,000 companies each year, support that delivers 66,000+ tonnes of CO2 savings per year with a further 248,000+ tonnes of annual savings in the pipeline. The companies are achieving cost savings through resource efficiency of £23 million per year with a further £77 million in the pipeline. Recent analysis of these results shows that 58% of cost savings have been achieved with no capital investment from the businesses, evidence that simple changes in practice can deliver significant economic and environmental benefits.

Delivering support at a local level At a local level the support is delivered through a network of partners including not-for- profit organisations (e.g. Groundwork Trusts and Cumbria Rural Enterprise Agency) and sector-support organisations (e.g. Chemicals Northwest and Food Northwest). This ensures that wherever a business is based there is always a support-provider nearby that understands and can respond to local need and is locally accountable. The regional structure of the partnership ensures that all businesses receive a consistent and quality- assured service and that all delivery partners benefit from shared learning across the network, both avoiding duplication of effort and enabling best practice to be identified and disseminated. In addition, rather than duplicate services that are provided by others, such as The Carbon Trust, ENWORKS encourages businesses to access these services where appropriate.

Data on improvements in local businesses ENWORKS collects data on the efficiency improvements made by the businesses it supports using the ENWORKS Efficiency Toolkit, a bespoke piece of online software that businesses can access to prioritise, track and report the economic and environmental savings from their improvement actions. The data held in the Toolkit has been made available to a range of stakeholders including local authorities (e.g. in relation to National Indicator 186) and central government departments (e.g. BIS & DECC) who need to monitor the impact of actions on carbon emission reduction (ENWORKS 2009 and Nicholson 2010).

ENWORKS is delivering support that is successfully coupling cost savings for companies with substantial cuts in carbon emissions. This model of delivery through local partners could link in with an area-based approach.

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Ashden Award winner the MEA has also made supporting SMEs a key element of its work through its Low Carbon Enterprise programme. The programme offers impartial technical support and project delivery capability to public, private and third sector organisations across the West and East Midlands, advising on the efficient use of energy, the reduction of carbon emissions and the installation of renewable energy.

One of the Low Carbon Enterprise projects, Low Carbon Communities for Business, worked with over 100 small businesses across four communities in Shropshire .Each received technical assistance with the implementation of sustainable energy measures in their premises. This led to 25 sustainable energy projects and six business diversification projects with a total of £210,000 of grant funding. The estimated savings from the project are at least 200 tonnes of CO2 with £50,000 in energy cost savings per annum for the businesses.

3.3.5 Developing a long-term vision „Hackbridge Sustainable Suburb‟ (see below) is a project that is yet to deliver outcomes, but is developing a novel planning-led approach to delivering local sustainable energy. A Master Plan (Tibbalds 2009) sets out a long-term vision incorporating new development alongside refurbishment of existing buildings. Its success is that it has already brought together the local authority planners and the community to develop a truly comprehensive plan to transform a whole area.

A planning led area-based approach

Ashden Award Winner, Bioregional Development Group describes itself as “an entrepreneurial charity which initiates and delivers practical solutions that help us to live within a fair share of the earth‟s resources - what we call one planet living” (see www.bioregional.com). It is best known for its groundbreaking Beddington Zero Energy Development (BedZed) in the London Borough of Sutton.

As part of the wider One Planet Sutton initiative, Sutton Council has been working with, Bioregional to transform the district of Hackbridge in the London Borough of Sutton into a sustainable suburb.

In planning terms it will elevate the existing local centre to a district centre (Hackbridge already includes BedZed). The proposals combine community involvement work with a large- scale retrofit programme for existing homes, and the development of 1100 new environmentally-friendly homes. The initiative covers energy use, waste and recycling, sustainable transport, low impact materials, food, water, habitats, local identity, economic regeneration and improving community wellbeing (Tibbalds 2009 and www.oneplanetsutton.org/hackbridge).

One of the early features of the initiative has been its success in bringing together a range of partners, including the local authority, an entrepreneurial charity (Bioregional), community groups and residents, and a major retailer, B&Q.

This initiative is still at the planning and consultation stage, but through its integrated and long-term approach, it demonstrates a different way of delivering neighbourhood solutions to sustainable energy.

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4 Building on success: what could be done?

Chapter summary Area-based energy efficiency approaches combined with other approaches to delivering local sustainable energy - for example those that empower communities to take action, develop local energy supply and generation and build local supply chains - create „enhanced area-based approaches‟ which provide a more holistic approach to emissions reduction and create lasting momentum and community engagement.

These enhanced area-based approaches will also need to be locally and culturally specific, work at a neighbourhood scale and include strong community involvement. There is no „one-size-fits-all‟ model that could be replicated across the UK. But we can learn from success, and identify replicable success factors for others to learn from. Key enabling factors identified through this research include:

 An impartial „hub‟ organisation.  Local authority involvement.  Partnership working.  Developing a local supply chain.  Green entrepreneurs.  Customer care.  Creating income streams.

Strong community involvement and leadership can also add a significant extra dimension to achieving deep carbon reductions. It can:

 Change collective behaviour, beliefs and value systems, galvanising social action on wider emissions reduction.  Tap in to existing community strengths, build the capacity of „weaker‟ communities and increase buy-in and take-up of initiatives.  Empower communities to devise and lead work on emissions reduction which can lead to solutions that fit the local context and are better than top- down programmes.  Build on existing trusted relationships with local individuals and networks.

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4.1 What have we learned? The examples highlighted in the previous chapter showcase a range of intiatives which highlight different „fields‟ of local sustainable energy, notably energy efficiency, behaviour change, and small-scale renewable generation.

We now turn our attention to how we might build on this success in the future. One way to do this would be to build on the success of area-based energy effiiciency schemes by integrating and coordinating them with other successful approaches to delivering local sustinable energy. This would provide a more holistic solution to achieving carbon emissions cuts at a neighbourhood level, one that could achieve deeper, longer-last cuts, where physical and technological improvements are backed up by behaviour change at an individual and collective level.

In particular the examples above highlight a number of elements that could be added to area-based energy efficiency initiatives to create „enhanced area-based approaches‟, such as:

 Working with communities to prime the neighbourhood for an area-based scheme, building ownership, increasing take-up of measures and building collective behaviour changes.

 Integrating small and district-scale renewable energy schemes.

 Developing the local capacity to deliver and maintain the technologies, creating jobs and supporting the local green economy.

 Supporting businesses to take action on climate change and become more energy intelligent.

 Having a much longer-term, more integrated low carbon vision for the area, working with communities to redesign areas and develop a broad vision that integrates new development with the retrofit of existing buildings and that goes beyond local sustainable energy measures.

4.2 Existing approaches to delivering local sustainable energy Another way of looking at the experience to date, is to consider approaches as a continuum, summarised in the table below.

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The continuum presented here ranges from approaches that are extremely large in scale and have no community involvement, to those which are very small in scale but are led and owned by the community.

There also differences in the breadth and depth of the schemes. The larger schemes tend to have very wide coverage and offer economies of scale, but focus on a very limited range of measures (e.g. loft insulation), whereas the smallest are very limited in coverage but often involve much more systematic change, involving changes in values, skills, awareness and behaviours, as well as a range of measures. The former are easier for governments to promote through policy frameworks, the latter are so small they can fall off the policy radar.

The schemes also demonstrate that there is not a „one-size-fits-all‟ model for delivering local sustainable energy. The examples reviewed work because they are „situated‟ within the local area, reflecting local culture, conditions and needs. And none of the approaches described here are mutually exclusive. Different approaches have different advantages and disadvantages and some will be more suited to some areas than others.

4.3 What could be done? To build on success, we not only need a policy framework that encourages a multiplication of local sustainable energy initiatives reflecting local diversity, but we also need to encourage approaches that go even further.

A much more comprehensive package of measures needs to be applied to homes and businesses which includes micro-generation technologies and more disruptive and costly measures such as solid wall insulation. Such approaches will need to cover a sufficient number of households and businesses in order to build a critical mass, achieve economies of scale and affect collective behaviour change.

Area-based approaches should, where possible, be linked to schemes that address other parts of the local sustainable energy jigsaw, such as neighbourhood-scale sustainable energy generation, and the development of local supply chains.

And, significantly, alongside this is the need for fundamental behaviour change as part of a major shift in values and collective behaviour. Without a shift in behaviours, carbon savings made through physical measures in households could be undone through the actions of the householders themselves. We discuss this aspect in more detail later in the chapter.

These enhanced area-based approaches will also need to be locally and culturally specific, work at a neighbourhood scale and include strong community involvement. Simply replicating an identical model may not work as well in a different local context where the local community were not involved in generating the concept. There is no „one-size-fits-all‟ model that could be replicated across the UK. That it is not say that we shouldn‟t try to learn from success, identifying replicable success factors for others to learn from. But we should avoid imposing or replicating models in their entirety, as they may not work.

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4.4 What might enhanced area-based approaches look like? Enhanced area-based approaches could offer the advantages of schemes such as Kirklees - wide coverage, economies of scale, local job creation - alongside collective change and action, developed local sustainable energy supply, and supporting the development of local supply chains.

What might these enhanced area-based approaches look like? Each approach would be different, but would build on learning from existing best practice. But essentially they would mix and match different elements from the approaches outlined in Table 5 and described in Chapter 3. By way of example, two high-level scenarios might be:

Scenario 1: area-based energy efficiency scheme as a first step on a neighbourhood- scale low carbon transition plan Area-based energy efficiency schemes are often the result of opportunistic bids to access funds from national schemes like CERT or CESP. However, in this scenario a local authority would integrate an area-based scheme (option 2 in Table 2), such as the one carried out by Kirklees, within a longer-term, more holistic vision and plan for reducing emissions in a neighbourhood, and for working with the community to shape their area (option 3).

The area-based energy efficiency scheme would be a key step in a longer-term vision of putting in place the physical infrastructure and economic base needed to a create a low carbon neighbourhood. This would require significant local authority involvement, building on its planning powers and responsibilities, and working with the community and local businesses, perhaps supported by an independent income stream through the development of locally-owned and generated sustainable energy.

Scenario 2: area-based energy efficiency scheme as the foundation for community action and leadership In this scenario, the area-based energy efficiency scheme (option 2) is designed and delivered as the foundation for increasing community action and leadership on emissions reduction (options 4 and/or 5).

This would combine the roll-out of energy-efficiency measures with comprehensive action to build collective change within the community, building on the lessons learned from initiatives like the Greening Campaign and Marches Energy Agency‟s Low Carbon Communities scheme.

It would create a legacy for further action and leadership from within the neighbourhood. This would involve a significant amount of awareness-raising and community capacity-building, which would not only increase take-up of the measures, but also create the skills and momentum within the community to take further action. The process could also be used to create local jobs, business and social enterprise.

These are just two examples. In section 5, we recommend that government creates a dialogue with local sustainable energy practitioners to explore how such enhanced approaches might be developed and supported in the future.

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4.5 How can we enable success? We do not want to be prescriptive about what shape enhanced area-based approaches might take. But we have offered some examples as to what they might look like.

However, we do want to ensure that the right conditions are in place for them to develop. In Chapter 5 we put forward recommendations for how government and others can create a framework that encourages, and creates the conditions for, enhanced area-based approaches.

We highlight some of the key ingredients, or enabling factors, that will be necessary to make any enhanced area-based approaches a success. We also pay particular attention to the need to empower communities (section 4.6).

4.5.1 The importance of an impartial ‘hub’ organisation A common factor in the local sustainable energy initiatives we have looked at is the presence of an impartial hub organisation at its heart. What is needed is a locally trusted organisation that can orchestrate activity, is trusted by the communities it is working with and is skilled in bringing together and working with local partners.

In some cases the hub organisation might be the local authority. In other cases, it might be a socially-minded third sector organisation, such as the Energy Agency (in Hadyard Hill and Fintry), Marches Energy Agency or AliEnergy. In others it may be the community that is genuinely at the heart of things, such as Big Green Challenge Runner Up, Low Carbon West Oxford.

The importance of an impartial hub organisation was consistently emphasised by those we interviewed and by the project workshop participants. Significantly, those we spoke to emphasised that there is no „one-size-fits-all‟ answer as to which organisation should fulfil this role. Instead, the most appropriate organisation will depend on a range of factors, such as local geography and culture, where the capacity and skills lie, and who has the drive and entrepreneurial dynamism to make things happen.

This implies that any nationally-organised programme for heat and energy saving measures - such as the previous UK Government‟s proposal for community partnerships post-2012 or indeed the Green Deal - needs to flexible enough to allow the development of schemes that are locally-relevant and harness local creativity, and should not assume that local authorities are the only organisations that can play this coordinating role.

4.5.2 Local authority involvement That said, in the initiatives we have looked at, local authorities have often played an important, if not central role. They have:

 Led schemes, as in Kirklees and in Barnsley.

 Provided some or all of the funding for projects, including Kirklees Warm Zone, the Hadyard Hill project, the Greening Campaign initiatives, RE4D, and MEA‟s Low Carbon Communities project.

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 Used their community leadership role to bring together local partners, as in Kirklees as well as in the RE4D partnership and the Hackbridge Sustainable Suburb initiative.

The importance of local authority involvement in area-based schemes was also highlighted in the project workshops. The workshop participants agreed that a „trusted broker‟ is usually needed at the centre of any area-based initiative, and that local authorities are often strong candidates to play this role (but not the only option).

Participants cited a number of advantages to local authority leadership or involvement. For example, they:

 Are at the right spatial level to coordinate area-based initiatives.

 Can pool different sources of income, contributing their own funding and resources to initiatives, as well as leveraging external finance.

 Are well-placed to draw together information and data on the local housing stock as well, as contributing their own local knowledge and intelligence (e.g. of the social housing stock)

 Are generally trusted by residents, compared to energy companies for example.

 Have a wide range of other roles and responsibilities, which can be used to deliver sustainable energy locally, including strategic planning responsibilities. Uttlesford District Council, for example, has set out a requirement for energy efficiency measures to be carried out throughout an existing building as a condition of planning consent for a home extension (Audit Commission 2009).

The workshops also highlighted a number of limitations to local authority involvement:

 Finance can be a limitation. Local authorities are often not in a position to provide significant funds for an initiative, a situation likely to be exacerbated by the current squeeze on local authority finances. Even in Kirklees, local authority funding came from a one-off windfall from their share of the profits from the sale of Leeds/Bradford airport.

 Local authorities might not be as entrepreneurial or innovative as private or third sector organisations, although there are certainly exceptions to this (see „community entrepreneurs‟ below).

 Many local authorities have limited staffing resources to assist and coordinate area- based schemes.

 Capacity and knowledge on local sustainable energy in local authorities varies significantly.

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Significantly, the piloting of Local Carbon Frameworks in 2010 will see local authorities playing a much more strategic role in delivering local sustainable energy. These pilots will demonstrate how local authorities can shape and determine neighbourhood action on local sustainable energy.

4.5.3 Partnership working In the workshops conducted for this project, successful partnership working was highlighted as a major determinant of success. Participants identified a wide range of organisations that could be involved in neighbourhood solutions, including local authorities, businesses (local and national), local community groups, energy agencies, social enterprises, schools and colleges, the wider public sector, utilities and financiers.

Indeed, regardless of which organisation is at the centre or arrangements, all of the initiatives that have been described in Chapter 3 involve extensive partnership working. This has brought significant benefits. In Kirklees Warm Zone, for example, the local authority has worked with a range of partners to deliver benefits that go well beyond energy efficiency measures, including benefits checks, health referrals, fire safety checks, and, anecdotally, the strengthening of community cohesion.

4.5.4 Developing a local supply chain One of the successes of the initiatives has been their ability to work with leading sustainable energy businesses to develop local supply chains. This was highlighted in particular by the RE4D initiative, but other initiatives have been developed in ways that support local job creation and local businesses. Kirklees Warm Zone, for example, has lead to the creation of 129 jobs. This can offer enormous benefits. It develops a source of local, trusted expertise on sustainable energy issues and increases local ownership and support.

4.5.5 Green entrepreneurs Green entrepreneurs are individuals or organisations - often locally-based - that provide the drive, dynamism and creative spark to kick-start and develop an initiative. A key theme to come out of the research was that green entrepreneurs are very often key to the success of area-based approaches.

Dick Bradford at Barnsley MBC, and Phil Webber at Kirklees MBC, were both frequently cited by those we spoke to during the research as key to the success of their respective projects. In other cases, it is the organisation that has been the catalyst for change. These can be specialist agencies such as the Energy Agency in Scotland, or the Marches Energy Agency in the Midlands, or grassroots community organisations like Low Carbon West Oxford.

While there was agreement amongst workshop participants and interviewees that green entrepreneurs are important, there was less consensus about how to repeat their success in other areas. However, it was agreed that it is not necessarily a shortage of community entrepreneurs that will hinder progress, as there are plenty around. Instead, the challenge is to attract them into the field of local sustainable energy in the first place.

Workshop participants also highlighted a closely related theme. Successful local sustainable energy schemes are often the result of the innovative solutions developed by

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these green entrepreneurs. Behind this innovation is a certain amount of risk-taking, a willingness to go beyond the norm. Allowing people and organisations the space to do this is crucial. But what is equally as important is accepting that innovation and risk-taking can also lead to failure. It is this fear of failure in national and local government that can often stifle innovation.

4.5.6 Customer care One of the success factors behind the area-based schemes reviewed in Chapter 3 was a strong focus on what in business terms might be described as customer care. This was essential in retaining community confidence in schemes. In terms of delivery, this was linked to very practical factors such as:

 Flexibility in meeting the needs of householders. For example, convenient times for home energy assessment visits and installations.

 Minimising the period from first contact to installation of measures.

 Being responsive to complaints by taking prompt action.

Those we interviewed for this research (particularly Energy Agency and Kirklees) made comparisons between what they were achieving and what was typical of big national programmes. The Energy Agency, for example, said that they were able to install measures at Hadyard Hill within two months of the first contact with householders whereas with WarmDeal (Scottish equivalent of WarmFront) and the Scottish Central Heating Programme householders were typically waiting in excess of 5-6 months (Scottish Government 2008).

The Kirklees and Hadyard Hill schemes also offer low-income households help with social benefits entitlements. This reinforces the perception that the scheme is offering a „helping hand‟.

4.5.7 Creating income streams Given the squeeze on public spending, alternative mechanisms for funding local sustainable energy initiatives are crucial. Participants in the practitioner workshops highlighted that one route is for initiatives to develop independent income streams based on the ownership of key assets such as renewable energy generating plant. Again Ashden Award winners are demonstrating this as a key factor in their success.

Gigha Renewable Energy Ltd generating electricity and an income

Gigha Renewable Energy Ltd owns three windmills which are second hand Vestas V27 wind turbines, each with an installed capacity of 225 kW (known by the islanders as the Dancing Ladies of Gigha). The company is a wholly-owned subsidiary of the Gigha Heritage Trust, the community organisation that also owns the island (the island has just 120 inhabitants). The financial model that has been developed can be widely replicated.

The model comprises a three-way mix of grant funding (33%), loan finance (37%) and equity finance (30%). The loan will be repaid over a five-year period at a fixed rate of interest, with

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the equity currently held by the Highlands and Islands Enterprise (HIE) bought back by the Isle of Gigha Heritage Trust in year five. Furthermore, over the first eight years of the project, a capital reinvestment fund of approximately £160,000 will be built up, sufficient to replace the wind turbines when required.

Gross annual income from electricity sales from the three turbines is £150,000 per annum. After all running costs (including maintenance, rates and insurance), the creation of the capital sinking fund, the loan repayments and equity re-purchase, the net profit for each of the first eight years is approximately £75,000 per year.

See: www.gigha.org.uk/windmills/TheStoryoftheWindmills.php

The role of the Highlands and Islands Enterprise (HIE) has been significant in facilitating the development of the Gigha wind farm. HIE is the Scottish Government‟s economic and community development agency for a region which covers more than half of Scotland (the equivalent of an RDA in England). HIE provides financial assistance and technical advice for community-led initiatives. HIE say on their website that:

“„Integration of business development within the community fosters indigenous growth and entrepreneurial activity and generates community confidence. Community assets include land, the environment and infrastructure owned, managed or impacted on by the community. By encouraging community-based options for the use of these assets, we can increase the capacity of communities to undertake their own local development.‟ (www.hie.co.uk/strengthen-your-community.htm).

This is a model for successful regional government intervention that has provided a long- term income stream for the community, independent of the public purse. Part of this income will be invested in cutting carbon emissions on the island.

Of course, one-third of the up-front capital for Gigha Renewable Energy Ltd came from grant funding. In the current climate of constrained public spending it shows that where Government does provide grant funding it should be targeted on pump-priming projects that can generate long-term independent income streams. A number of new policy mechanisms - Feed-in-Tariffs, the Renewable Heat Incentive, Pay-As-You-Save, the Conservatives‟ Green Investment Bank proposal - provide further opportunities to leverage finance. Furthermore, there are already other examples of community-owned assets that are less dependent on public finance.

At Fintry in Stirlingshire, for example, a community-led initiative has bought the 15th wind turbine in the privately owned Earlsburn wind farm that has been developed near the village. The 2.5 MW wind turbine is costing the community £2.5 million, payable over 15 years. Over those years they anticipate a net income for the Fintry Development Trust of between £50 and £70k per annum, but after the repayment period the income will jump to £400k per annum. This income will provide real opportunities for deep carbon emission reductions for a community comprising just 333 households and a total population of around 800. Income generation began in 2008 and is already being used to part-fund the Fintry Community Energy Project (based on the model of Hadyard Hill), which is improving

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the energy efficiency of homes via basic insulation measures at no cost to householders. The community is now considering investing in microgeneration technologies.

Both of the above examples are based around renewable energy generation from wind. Generating an income from this energy source is more problematic in urban areas. Nevertheless, creating an independent income stream needn‟t be unique to rural areas. „Obligated finance‟ is one such option open to local authorities in urban areas. Milton Keynes has introduced a Carbon Offset Fund for new developments. New buildings are required to be as energy efficient as possible, with developers being required to offset into the Milton Keynes Carbon Offset Fund any remaining carbon expected to be generated over the lifetime of the site. The local authority will then spend that money on measures that reduce carbon emissions. The fund is estimated to raise £800,000 per year (Building 2010).

In another example, Low Carbon West Oxford has been developing a range of community- owned renewable energy initiatives, such as placing solar panels on the roofs of local businesses, installing wind turbines at a secondary school and developing a micro-hydro scheme at a local weir. The electricity generated from these projects will be sold by Low Carbon West Oxford, and the income will be used to help local households make energy savings. To help provide up-front capital for the initiatives, Low Carbon West Oxford has set up West Oxford Renewables, an Industrial and Provident Society (IPS shares are sold to local people and friends of the community).

The introduction of feed-in-tariffs (FITs) for electricity from April 2010 and a Renewable Heat Incentive (RHI) from April 2011 also provide opportunities to use smaller-scale renewable technologies to generate a secure income (e.g. micro-hydro and PV projects rather than large-scale wind turbines).They should also increase the take up of these technologies by households, businesses and communities. Further work will be required to develop business models that could take advantage of FITs and the RHI, and to secure the up-front capital costs required to invest in the technologies in the first place.

4.6 Empowering communities The evidence base for the benefits of involving communities in delivering carbon reduction schemes is still developing and not always conclusive. Nevertheless, there is much to suggest that strong community involvement, or in some cases leadership, can add a significant extra dimension to achieving deep carbon reductions.

Community involvement is important in raising awareness of the scheme, building trust with local people and ensuring that the scheme has a legacy in terms of raising awareness of energy issues, building confidence and capacity and increasing the possibilities for the development of community-owned renewables.

Here we focus on the factors that enable communities to add that extra dimension to enhanced area-based approaches.

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4.6.1 Achieving culture change “The scale of the cultural change required to create a sense of responsibility in each community for its contribution to delivering secure, affordable low carbon energy services is enormous…The nature of the required culture change means it is unlikely that it will be achieved by „shiny new initiatives‟, however politically appealing. Such change will tend to emerge „from within‟ communities. It therefore needs to build from existing efforts, capacity and relationships which have been designed to achieve this” (Simon Roberts 2009, CEO of Ashden Award winner, the Centre for Sustainable Energy).

It is now widely accepted that behaviour change is one of the key factors in achieving deep carbon reductions. Physical measures can only go so far in reducing emissions. Furthermore, in some instances the impact of physical measures can be entirely negated unless they are accompanied by appropriate behaviour.

A key learning from the BedZED development, for instance, is the importance of considering not just the buildings, but how to help residents lead sustainable lifestyles. An evaluation of BedZED found that whilst residents exhibit low energy use24, and demonstrate a range of green behaviours, such as food growing, low car ownership and relatively good recycling rates, they also fly more than the average UK resident, emitting an estimated 1.9 tonnes of carbon dioxide a year (Bioregional 2009).

Enhanced area-based approaches with a strong community element can provide a springboard for achieving a culture change, which might be defined as a change in collective behaviour, beliefs and value systems. Achieving such shifts in culture and values provides the foundation and driver for individual behaviour change.

In theoretical terms it involves creating new „descriptive norms‟ which specify what is done, based on the observation of the majority of others (Darnton 2008, 13) and „personal norms‟ such as a belief that what you do together will have an effect. Initiatives with strong community involvement are capable of creating a culture where:

 It becomes normal behaviour for most people to seek to cut carbon emissions.

 People believe that collectively a community can make a real contribution to climate change.

 People adopt the viewpoint that it is a joint responsibility to take action.

The following factors provide the basis for such a culture change:

 Moving people from being passive, isolated individuals to being part of an active community.

 Creating a supportive environment where behaviours and identities that were previously perceived as being marginal, can be adopted - e.g. „being green‟.

24 BedZED households use 45% less electricity a year, and 81% less heat, than average Sutton residents (Bioregional 2009, p9).

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 Experiencing working together and receiving support from each other, allowing individuals to believe that they can make a difference collectively.

 Creating an ethos that particular actions are a part of everyday life. The views of peers are part of this ethos, so belonging to the community both becomes an inspiration to action that is matched by a feeling of obligation to support common aims.

Having created this context, members of the community feel that they as individuals are being helped by their community to achieve joint objectives (as opposed to feeling they are being made to do something). This mutual support can then stimulate more ambitious ideas and actions that previously appeared too difficult (NESTA 2010).

A number of the examples used in this research are working to achieve this kind of culture change, including the Marches Energy Agency Low Carbon Communities project and the Greening Campaign. The small island of Gigha is a good example of where such a shift has happened.

The workshops also highlighted the potential to work with communities to help achieve a cultural shift in behaviours and attitudes. From participants‟ experience, community groups can provide a mechanism for sharing knowledge. One of the strengths of the Greening Campaign is that it brings communities together, enabling individuals to learn from their neighbours and to create a shared sense of endeavour.

Richard Davies, Director at Marches Energy Agency has found that working with community groups “increases critical mass and momentum-building in the local areas”. For example, many of the local communities it has worked with through its Low Carbon Communities programme have gone on to create their own initiatives for transforming their areas into low carbon communities.

4.6.2 Build on strong communities An ESRC funded evaluation of community energy initiatives concluded:

“..positive outcomes are likely to be maximised where projects are led by local people or existing community groups, where there is already social cohesion and where involvement and benefits are strongly collective in nature (Walker et al. 2006).

This viewpoint was backed up by respondents in interviews carried out for this project. For example, the Energy Agency has to tailor the support it provides according to the strength of communities with which it is working. Some need far greater support because of lack of social cohesion, lack of skills and lack of individual confidence in decision making and handling finances.

However, where there are strong community capacities, community-led initiatives do have impressive results (e.g. Island of Gigha, Fintry). The greatest added-value from community action to cut carbon emissions will be found within communities that already have strong capacities. In rural areas, a well-defined geographic community will often be quite apparent. In urban areas, working with less geographically-defined communities such as schools, workplaces and religious communities may be more appropriate

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It follows that „weaker‟ communities will need outside support for their potential to be fully realised. The Greening Campaign and Ashden Award winners such as Marches Energy Agency and the Energy Agency provide good examples of how to do this.

4.6.3 Community leadership and empowerment Dynamic local individuals, community groups and organisations are often at the heart of successful local sustainable energy initiatives. Recent work on the lessons learnt from the Big Green Challenge finalists25 by the National Endowment for Science Technology and the Arts (NESTA 2010) shows that the most successful community-based initiatives have directed but responsive leadership. This can be characterised as being provided by individuals or small groups that include:

 „Catalytic individuals‟ who have a clear sense of direction and are prepared to take risks.  People who are „embedded‟ in their community with strong links to a range of individuals and local organisations.  Individuals with some relevant experience of management derived from their „day job‟.  People capable of identifying and connecting with the experts and professionals who can provide them with appropriate support.

Such leadership is capable of breaking the mould and innovating. It may in some instances fall to individuals to provide such leadership, but several of the most successful Big Green Challenge finalists were led by small groups which balanced willingness to take risks with expertise and experience.

The evidence from the Ashden Award winners and the Big Green Challenge is that given such leadership, communities are very capable of devising and leading local solutions to fit the local context. These solutions are better capable of delivering than programmes that operate on a top-down basis.

4.6.4 Utilising trusted individuals and known local networks A repeatedly reported lesson from respondents in interviews and from the workshop sessions is that successful community action is based on the existing trusted relationships with local individuals and the use of local networks. This provides a significant route to influencing behaviour and lifestyle. The community can provide the interface between national actors (Government, government agencies, energy suppliers) and ordinary people (e.g. faith groups and residents associations).

Ashden Award winners highlight that there is a big opportunity to work with local groups, including climate action groups, local churches, residents groups and so on. They provide a free „resource‟, are already motivated to work with their community to achieve change and provide a recognisable „entry point‟ for working with the local community. In return, this means that initiatives are more likely to be embedded in the local community. And, by

25 The Big Green Challenge is NESTA‟s £1 million challenge prize designed to stimulate and support community-led responses to climate change. The winners were announced in January 2010. See www.nesta.org.uk/areas_of_work/public_services_lab/environment/big_green_challenge

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building further capacity, motivation and interest, this helps to create a wider shift in attitudes and behaviours in local communities.

RE4D, for example, is working with members of the Devon Climate Action Network - made up of Transition Towns and other climate action groups - as a route to local communities. And Marches Energy Agency is also working with Transition Town groups as its starting point for working with communities.

Appropriate ways of working are needed to realise this potential, especially recognition of the need to let communities take the initiative. Terena Plowright of the Greening Campaign (an organisation working with over 180 communities) commented: “You always start with the people who want to start it. We train them how to engage with their communities. They are very rarely typical „greens‟, but are people like school teachers and parish councillors, etc…others in the community relate to them very easily because of their local knowledge base.”

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5. Conclusions and recommendations

5.1 What are our conclusions? The research has found that „one-size does not fit all‟ when it comes to delivering local sustainable energy solutions. More often than not, best practice is the result of innovative, entrepreneurial, partnership approaches, based on local intelligence. Success is often achieved in spite of, not because of, the existing policy framework.

As we have stressed, area-based energy efficiency initiatives are a very good model for delivering emissions reductions at the neighbourhood scale. They deliver significant levels of take-up of simple insulation measures in a cost-effective way, whilst also achieving a number of wider benefits, such as local job creation and benefits checks.

These area-based energy efficiency approaches could be significantly enhanced if integrated with other successful approaches to delivering local sustainable energy, for example through empowering communities to take action, local energy supply and generation and building local supply chains. This would build on the strengths of area-based approaches, whilst offsetting their weaknesses, providing a more holistic approach to emissions reduction that creates lasting momentum and community engagement at the neighbourhood level.

5.2 How do we get there? The election of a new UK Government, one that intends to be the greenest ever and wants to empower neighbourhoods to take social action, means there is a real opportunity to create a framework that will enable enhanced area-based approaches to be right at the heart of the UK‟s transition to a low carbon economy. The Governments in Scotland and Wales also have a vital role.

So what is required?

Government should create a framework that supports the development of enhanced area- based approaches. Government needs to provide a strong sense of overall direction, giving appropriate support at key points in the development of enhanced area-based schemes. It also must provide the incentives, flexibility, and space - and remove the barriers - for communities, local authorities, social entrepreneurs and businesses to develop the solutions that work best for the areas in which they operate.

To help create the right framework in which enhanced area-based solutions can flourish, we make the following recommendations to government.

Developing the policy framework

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Recommendation 1

Build a flexible policy framework that supports holistic approaches to delivering sustainable energy at a neighbourhood level Government should build on the plans set out by the previous administration for developing a flexible policy framework for home energy saving.

Through the Green Deal and other key policies, Government should create a policy framework that allows for a diversity of approaches to delivering local sustainable energy. These policies need to provide incentives for going beyond the installation of energy efficiency measures, encouraging more holistic approaches to retrofitting neighbourhoods that incorporate sustainable energy generation, support local jobs and develop local supply chains.

The framework should also encourage the involvement of community groups in delivery partnerships, and reward action to achieve „softer‟ outcomes that influence human behaviour and help to create a momentum for change within neighbourhoods. It should aim to reach community groups and businesses as well as individual households.

Recommendation 2

Integrate area-focused funding to achieve multiple policy objectives Government should consider developing a programme to test out how to support enhanced area-based schemes that achieve wider benefits, including actions on energy, waste, water, food, transport, and greening the local economy. Lessons could be learned from the work of the Low Carbon Communities Challenge, which has already brought together funding from different sources to support integrated community approaches.

This could involve:

 Pooling grants and funding from different policy areas and departments.

 Delivering co-ordinated support to area-based schemes from different departments to achieve multiple policy objectives.

 Monitoring and collecting useful data for measuring success across a range of policy areas without this being an onerous task for project managers of area-based schemes.

Recommendation 3

Open a dialogue with cutting edge practitioners to develop a model for enhanced area- based approaches Government should build on this research and that of others26 to open a dialogue with Ashden Award winners and other local sustainable energy practitioners to develop a model - or models - for enhanced area-based approaches.

26 See for example the Sustainable Development Commission‟s report on creating sustainable neighbourhood infrastructure partnerships.

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This research has highlighted the potential to create enhanced area-based schemes. But more thinking is required. Opening a dialogue would enable government to develop models and ensure that the right policy framework is in place to support their development.

This dialogue could also support wider policy development on sustainable energy. The project workshops highlighted that local sustainable energy practitioners, such as Ashden Award winners, would welcome opportunities to seriously engage with policy development, but currently feel marginalised. Their voices, as well as those of community groups and other potential local partners, need to be heard by Government, in particular in areas that are of real relevance to area-based initiatives, such as smart grids, infrastructure investment, distributed energy, finance and household energy management.

Recommendation 4

Develop a consistent approach to monitoring and evaluation Government should convene a project that brings together local practitioners with carbon measurement and behaviour change experts to develop standardised methodologies and tools that are capable of measuring change across a very broad range of carbon emission reduction activities.

A more consistent approach would provide better feedback within an area-based scheme and enable local and national government to better monitor carbon budgets and progress towards targets.

One of the findings from the research is that lack of standardised, and consistently used, methodologies for measuring carbon reduction activities often leads to projects spending time and resources developing their own systems, which results in the production of data that is inappropriate for comparison across projects or for use in carbon budgeting.

It is also clear from the research that some of the „softer‟ - but equally important - potential impacts of area-based initiatives, particularly behavioural and cultural change, are much harder to measure than „harder‟ impacts such as carbon savings. Work needs to be done to develop better - and easier-to-use - tools for measuring behavioural and cultural change. This could build on the work by CAG and WWF to develop the Change! Tool for evaluating behaviour change.27

Supporting communities

Recommendation 5

Expand support for community action on climate change This research has highlighted the key role that communities can play in delivering local sustainable energy. The new coalition government is also seeking to create a Big Society, which supports community action.

Government and the EST should therefore expand its support for community capacity- building for local sustainable energy. This should build on the lessons learned from existing practice, for example from the Big Green Challenge, the Low Carbon Communities

27 www.community-engagement.org.uk/legal.html

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Challenge and Climate Challenge Fund. The expanded support should also link to more localised initiatives such as the Greening Campaign and the MEA‟s Low Carbon Communities programme, to reinforce, rather than duplicate, efforts.

The aim is to support the building of community capacity and strengthening community networks to the point where any community can play a part in, or develop their own, carbon reduction initiative. It needs to be recognised that this form of support is labour intensive and takes time and patience, but provides the essential basis for developing initiatives and achieving the culture change that is fundamental to making deep cuts in emissions.

Recommendation 6

Develop the evidence base on community action on climate change Government should work with others to develop the evidence-base to help communities to identify what works and to quantify the benefits of such action.

The evidence-base on community action on climate change is under-developed. We need to understand what community approaches stand the best chance of delivering what emissions reduction outcomes, to enable us to scope the role communities can play in area-based scheme delivery.

We also need to share this learning with practitioners. This could be done, for example, by carrying out a mapping exercise to help us illustrate the links between process and outcome in existing community-based initiatives.

Finance and funding

Recommendation 7

Expand competitive grant funding to kick-start initiatives Government should continue to provide and expand competitive grant funding to provide initial support for a diverse range of enhanced area-based approaches with strong community involvement.

Many of the initiatives we have examined in this research have been dependant on initial grant-funding to get their scheme off the ground. Without it, their chances of success would have been seriously diminished.

Recommendation 8

Develop finance packages that can be accessed by small-scale projects To ensure their longer-term sustainability, initiatives also need access to finance. In order to support a diversity of approaches, the new green investment bank should develop models for financing initiatives that promote multiple sustainable energy outcomes and that are as accessible for „deeper‟ but small-scale projects, as for larger-scale projects.

Recommendation 9

Develop loan guarantees to underwrite risks for community projects

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Linked to this, government should also consider how loan guarantees can be provided to underwrite risks to enable community organisations to access private finance.

Recommendation 10

Create enhanced FITs and RHI payments for neighbourhood renewable energy projects Government should consider enhanced FITs and RHI payments for neighbourhood renewable energy projects that are creating income streams for further carbon reduction measures in their communities.

This would provide a valuable source of income for an enhanced area-based approach that could be recycled into further energy saving measures within the neighbourhood.

Local authorities

Recommendation 11

Create a strong mandate for local authority action on area-wide emissions reduction Government plans to abolish the Comprehensive Area Assessment, but it should ensure that there is a significant mandate in place that encourages local authorities to work with communities and business to reduce considerably emissions in their area, building on NI186 and the Local Carbon Framework pilots.

Recommendation 12

Build the capacity of local authorities to take action Kirklees and other pioneering local authorities are showing what an important role local government can play in reducing emissions at the neighbourhood scale. But most local authorities lack the skills and resources to play their part. Government should therefore work with local government and improvement organisations to build the capacity of all local authorities so that they are equipped to make a significant contribution to area-wide emissions reductions.

5.3 Considerations for the Ashden Awards The Ashden Awards has done much to celebrate the success of pioneering local sustainable energy practitioners across the UK. Through its work it has highlighted to Government what is possible and has shared good practice, helping to inspire more practitioners to follow in the footsteps of the Award winners.

Many of the Award winners who were involved in the research expressed a strong interest in building on the links made through the project and through other Ashden Award activity.

Consideration 1

The Ashden Awards should consider how it can build on and formalise these links through the creation of an active Ashden Award winners' alumni network that provides the Award

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winners with peer-support, cross-sectoral learning opportunities, and opportunities to play an active role in the Ashden Awards‟ policy work.

Consideration 2

The Ashden Awards should also consider ways in which it can share learning and expertise even more widely than it already does. This would help transfer knowledge and experience from existing successful projects to new and developing ones. Those involved in the research identified a number of mechanism through which this could happen, including:

 An annual practitioners‟ conference on specific „hot topics‟, such as delivering area- based initiatives.

 A mentoring scheme which paired successful practitioners with developing projects.

 Arranging visits to successful practitioners.

Award winners also stressed that they are regularly asked to share their expertise and knowledge at conferences, workshops, training events and so on. Taking time out of their day jobs to do this can be both time-consuming and costly, and acts as a barrier to them being able to share their knowledge.

Consideration 3

The Ashden Awards should also consider ways it can financially support those Award winners that actively share their experience and expertise.

One issue to come out of the research was a lack of consistent monitoring and evaluation of local sustainable energy initiatives. This leads to difficulties in comparing the relative merits of schemes, particularly in relation to some of the „softer‟ potential benefits of schemes, such as changes in behaviours and values.

Consideration 4

The Ashden Awards should consider the role it could play in helping its Award winners to monitor, collect and present data in a more consistent way, in order to better demonstrate their success.

Consideration 5

The Ashden Awards should also consider how it could support the take-up of the recommendations in this report. This will happen through its policy advocacy role anyway. However, there may also be opportunities for the Ashden Awards to actively kick-start projects that act on the recommendations above. For example, linked to Consideration 4, it could work with Government to develop some standardised methodologies and tools that measure success across a very broad range of carbon emission reduction activities.

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Finally, through this project and through its wider UK advocacy work, the Ashden Awards has established itself as an important champion for local sustainable energy in the policy- making process.

Consideration 6

Consider how it can build on this by using its position to create a coherent voice for local sustainable energy practitioners in the policy-making process. Ashden Award winners and the wider local sustainable energy community can often feel marginalised compared to „bigger‟ interests such as the major energy companies. The Ashden Awards is well-placed to convene these practitioners and help to provide a coherent and potentially powerful voice for local sustainable energy practitioners.

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Annex A. Project Advisory Group The Project Advisory Group‟s role was to help shape the project‟s scope and focus, identify who to involve in the research and to review and develop the project‟s emerging findings and recommendations. The group met three times over the project‟s course. We also had contact with various members of the group throughout the project.

Membership Name Position Organisation Ashden Awards for Sustainable Simon Brammer UK Programme Manager Energy Climate Change and Communities and Local Simon Brown Sustainable Development Government Ashden Awards for Sustainable Sarah Butler-Sloss Founder Director Energy Principal for Communities and Pete Capener NESTA Climate Change

Ian Draisey Director Dulas Ltd

Chair of Energy and Paul Ekins UCL Energy Institute Environment Deputy Head, Citizen-Led Department for Energy and Harriet Festing Policy-Making Climate Change

Denny Gray (Chair) Senior Consultant CAG Consultants Professor of Natural University of Cambridge / David MacKay Philosophy / Chief Scientific Department for Energy and Advisor Climate Change Jon Parker Joint Head, Energy Branch HM Treasury

Head of Branch, Heat and Department for Energy and Gavin Purchas Energy Savings Climate Change

Trewin Restorick Chief Executive Global Action Plan

Sue Riddlestone Executive Director Bioregional

Phil Webber Head of Environment Unit Kirklees MBC

Ashden Awards for Sustainable Dr Anne Wheldon Technical Director Energy

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Annex B. Summary of practitioner workshops The research included two workshops with Ashden Award winners and other successful energy practitioners. The first was held in Bristol on 12 October 2009 and the second in London on 20 October 2009.

Workshop objectives

The purpose of the workshops was to examine, based on participant experience, what could be achieved through the integration and coordination of local sustainable energy solutions in an area. The workshops focused on the following questions in particular:

1. How effective are integrated, area-based, approaches to delivering local sustainable energy at present? 2. How could integrated area-based approaches work to achieve significant change by 2016 and beyond? What are the key ingredients for success? 3. What are the key opportunities and challenges for delivering successful integrated area-based approaches in the future? 4. What synergies and benefits would be achieved through such approaches that individual solutions couldn‟t achieve alone (including non-energy related benefits)?

We also explored how such approaches could help create the conditions for social change and help create local ownership and leadership.

Ashden Town

To help prompt thinking about what integrated area-based approaches could achieve in the future, participants were asked to think about how their own organisation and those of the other workshop participants could work together, and with others, to achieve significant greenhouse gas emissions reductions in a hypothetical area: Ashden Town.

In Ashden Town, Ashden Award winners, other successful local sustainable energy practitioners and key stakeholders have come together to build on and integrate their existing good practice to deliver local sustainable energy measures. Over the next ten years, they will have:

 Dramatically reduced greenhouse gas emissions in the area, exceeding Government carbon reduction targets.

 Developed area-wide structures for successfully delivering local sustainable energy measures28 that bring together the community and the private, public and third sectors.

 Ensured that all cavity walls and lofts have been insulated, where practical.

28 The Ashden Awards defines local sustainable energy as having three strands all delivered close to the point of use: renewable electricity, renewable heat and cooling, and energy saving programmes in homes and in public and private sector organisations.

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 Provided all homes with „whole house‟ heat and energy efficiency solutions, including advanced measures such as solid wall insulation and small scale renewable energy measures.

 Retrofitted all other buildings in the area to a similar standard.

 Successfully developed a number of significant-scale, locally-owned renewable energy schemes.

 Ensured that over 20% of heat is generated from renewable sources.

 Kick-started a process of social change, with communities in the area motivated and mobilised to take responsibility for reducing their carbon footprint and making the area more sustainable.

 Achieved significant outcomes on a range of broader issues, such as local job creation, reductions in fuel poverty, reduced carbon emissions from transport, reduced per capita water use and so on.

Summary of workshop findings The workshops produced rich and varied material on how integrated, area-based approaches could work, what barriers need to be removed and what could be achieved. The summary below provides a brief snapshot of these.

Area-based, integrated initiatives  Overall agreement that there is value in area-based, integrated approaches to delivering local sustainable energy, albeit with a number of risks and challenges.  General agreement that there is „no one-size fits all' model.  A trusted broker is needed at the centre - local authorities are good candidates, but not the only option.  A wide range of organisations and skills are needed to meet the challenge. The workshops highlighted what a range of partners can bring to any such approach, including social entrepreneurs, big business (e.g. DIY stores), the NHS, faith groups and so on.  Agreement that the scale of the task is challenging and the outcomes set out in the Ashden Town vision are not necessarily achievable (and certainly not under existing policy framework).  Need to balance what can/should be delivered locally and what will/should be delivered nationally.  Caution over scaling-up too quickly. Suggestions about „future zones‟ and incubation areas, where the Ashden Town model could be fast-tracked.

Enabling factors  Finance. Current energy prices are too low to drive change. Feed-in Tariff/Pay-As- You-Save has real potential, but there are issues about who can underwrite the risk

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for local sustainable energy projects. Existing money could be re-directed to pay for building retrofit (e.g. Winter Fuel Payments). A number of new finance vehicles were suggested, e.g. green banks, green bonds, and pay-as-you-save.  Skills and capacity. Entrepreneurial and financial skills are needed, but not always available (they need to be encouraged). Communication skills, awareness raising and marketing skills are really important. Also local authorities need more capacity.  Powers, polices and regulation. The need to devolve powers locally (to local authorities and communities) was stressed. Planning powers need adapting and more financial discretion is required at local level. Local authorities need more incentives - they have powers but they are under-used (e.g. power of well-being). Regulation is needed to edit people‟s choices. It is also needed for planning and building.  Market confidence. The market needs a long-term policy framework that enables investment decisions to be made with greater confidence.  Linked to this, some shared the view that we need to explore what the ‘catalysts’ for change are (often cited in the workshops as the „wilful individuals‟). In other words, what has sparked existing success (e.g. Kirklees, Energy Agency) and how can that catalyst be replicated.

Social change and local ownership  Support (but not complete consensus) for mobilising communities to achieve change (although there is a need to define what a community is), albeit with significant challenges to doing so. Evidence is still lacking. Better monitoring and evaluation of such schemes is required.  Tension between those that advocated top-down solutions versus the need to encourage bottom-up initiatives.  Many suggestions on how to stimulate individual and wider social behaviour change including price and money, peer pressure, neighbourhood envy, psychology of competition, and creating positive visions through existing mechanisms and technologies (e.g. smart meters).

Synergies and benefits  Economies of scale (30-50%) can be achieved when scaling-up to an area-wide level. Could be higher if linked with business and communities and job creation opportunities. Local community initiatives can help create virtuous circles and wider benefits, while community involvement can lead to higher uptake of measures (EST examples, Greening Campaign figures).  There are real differences in the language and culture of the different sectors involved in area-based delivery. While synergies and benefits can be achieved through working together, this can also be a barrier to successful partnership working.

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Attendees, Bristol Workshop, 12 October 2009

Name Department / organisation Simon Brammer Ashden Awards for Sustainable Energy Geraint Davies Cwmni Gwynt Teg Cyf Richard Davies Marches Energy Agency Richard Freeborn Kensa Engineering Denny Gray CAG Consultants Trevor Houghton Houghton Research Hugo House Good Energy Adam Kennerley Household Energy Services Cartin Maby Gloucestershire Warm and Well Liz Marquis Energy Agency, Ayrshire Simon Roberts Centre for Sustainable Energy Keith Wheaton-Green South Somerset Hydropower Group

Attendees, London Workshop, 20 October 2009

Name Department / organisation Jon Andrews Leeds City Council Graham Ayling Energy Saving Trust Simon Brammer Ashden Awards for Sustainable Energy John Doggart Sustainable Energy Academy Denny Gray CAG Consultants Richard Harvey Rural Energy Jonathan Hines Architype Susan Parham CAG Consultants Terena Plowright Greening Campaign Trewin Restorick Global Action Plan Sue Riddlestone Bioregional Partick Sherriff Geothermal International Phil Webber Kirklees MBC Roger Wood Arun District Council

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Annex C. In-depth interviews As part of the research, we carried out in-depth interviews with a number of Ashden Award winners and other practitioners. They were:

Richard Davies, Marches Energy Agency

Ian Draisey, Dulas

Liz Marquis, Energy Agency

Samantha Nicholson, ENWORKS

Terena Plowright, Greening Campaign

Sue Riddlestone, Bioregional

Melanie Sealey, Renewable Energy 4 Devon

Phil Webber, Kirklees MBC

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